Why does elevator still raise and lower the nose when the aircraft is steeply banked?
At 45 degrees Angle of Bank pulling back will both tighten the turn, and cause the nose to rise equally because you are halfway to 90 degrees.  You are correct though, at much steeper angles of bank the control inputs function the other way:  In a very steep high G turn the angle of bank is used to control altitude, and back pressure is used to control the rate of turn.  You definitely don't want to use rudder in this case though, bad things can happen in an accelerated stall with yaw.