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Where to find the rabbit, starting from Ashford Abbey
A caged rabbit in Sunqua Vale.
A white rabbit in Drakkar Lake.
A Rabbit can be found on a rise above Ashford Village in Lakeside County. Unlike other creatures, the rabbit appears on the radar as a green dot like an NPC. Currently, the rabbit does not seem to have any use.
The rabbit cannot be tamed by rangers using Charm Animal or killed. Thus, contrary to dictionary definition and intuition, rabbits are not considered animals as per the game definition. AoE spells don't seem to have any effect.
There are also three rabbits involved in the Factions quest Free the Fur.
You can heal or enchant the rabbit, but it is not necessary.
There are also Rabbits in Eye of the North, which are slightly reskinned (white colour) and also cannot be tamed by rangers. Unlike the other rabbits, however, the ones found near Drakkar Lake can both turn hostile and be killed. There are also rabbits in Grothmar Wardowns. On the other side of Drakkar Lake, there are 3 other rabbits, and following these will get you to a place filled with Spectral Vaettir once you stand in the middle. If you are going to fight them, it is recommended to prepare before they pop up.
Trivia
Just as you follow a white rabbit in Drakkar Lake to certain doom, In the Disney classic, Alice in Wonderland by Lewis Carroll, Alice follows a white rabbit as well into a trap.
Screenshots taken in Drakkar Lake area, before and after following the rabbit.