To avoid unintentional loss of wood quality when selecting for higher productivity in tree breeding programs, non-destructive methods for fast and reliable assessment of wood quality on standing trees are required. In this study, we tested and applied Pilodyn penetration (PP) and measures of stress wave velocity (SWV) in trees within a European larch (Larix decidua Mill.) breeding program. Through testing PP in 4267 trees on 21 afforestation sites across a broad climatic spectrum, we analysed the effects of climate, tree age, and site conditions on PP. Moreover, detailed measures within two selected stands allowed us to estimate measurement variation within and among trees in relation to the measurement angle and individual tree characteristics. We found significant variation of PP and SWV among forests stands, single trees, and even within trees, if measured on opposite sides in mountainous terrain. Both measurements exhibited a high degree of genetic determination, i.e., repeatability was 0.32–0.61 for PP and 0.56 for SWV, respectively. The obtained estimates for wood stiffness were comparable to measures on harvested wood samples of European or hybrid larch. Our results demonstrate that the integration of wood quality parameters into larch breeding programs is highly recommended, and reliable tools are available. Results are discussed in relation to environmental and measurement variation and methods to optimize field measurements are suggested.