Yippee, medieval fantasy! I put so much unnecessary thought into the lore of the setting but I love it so.
Jonathan is a half-human half-fae, though no one can tell what he is when he dons his Scarecrow attire. A scarecrow brought to life by a witch? The ghost of a vengeful knight? A lich? Death itself? One thing is for certain, no one wants to cross paths with him.
He lives a mostly nomadic lifestyle, finding and collecting things that he can use to enhance his magic. He has enchanted the bones he decorates himself with as makeshift lightweight armor and protection against other magical attacks. As a bonus, it gives him an undead appearance. His fear toxin is a completely unique form of magic he made himself, because of this it is incredibly hard to counter.
Jonathan grew up with his human grandmother who treated him horribly for being a halfling. He was forbidden from using magic and grew up isolated. After she killed his beloved horse, Ashpuddle, that was the final straw. No longer having to worry about his grandmother he learns magic on his own and reanimates his precious friend. After that, he is determined to become proficient in magic and becomes obsessed with fear. Having been raised isolated from humans, he doesn't understand them and finds them to be horrible (as most magical creatures do) but interesting. He enjoys studying their fear.
I don't really like what I did with Ed's colors, so um... ignore them.
I usually see Riddler depicted as a fae in fantasy settings, but our Ed is not a pretty boy Riddler but instead some kind of little animal. So he is a dragon. Some dragons tell riddles, they kidnap people, and are typically depicted as highly intelligent.
His father gave him to his human grandmother as an egg, and she raised him for the first few years of his life until his father decided to take him back and raise him as a proper dragon. Though he has no intention of actually teaching Ed instead using him as a punching bag to ridicule and project his own insecurities about being raised by a human himself and being mostly outcasted from dragon society. Dragons have a bitter rivalry with humans and it's incredibly taboo to be associated with them in any way.
As an adult, he is left to fend for himself and is hardly prepared to live as a normal dragon. He decides to become the Riddler trying to prove himself to the people of Gotham so he can assimilate into human society and go back to living a normal life with his grandmother. His idea of proving himself doesn't exactly help him and instead makes him a lot of enemies. Dragons are seen as incredibly valuable, dragon parts are used for powerful magic and medicine. He'd fetch a pretty penny and many people he goes after plan to butcher and sell him. He's essentially trying to be the knight that saves the day, but alas he is a dragon.