It is the Nativity scene ONLY! Per Wikipedia:
Customs of erecting decorated trees in wintertime can be traced to Christmas celebrations in Renaissance-era guilds in Northern Germany and Livonia. The first evidence of decorated trees associated with Christmas Day are trees in guildhalls decorated with sweets to be enjoyed by the apprentices and children. In Livonia (present-day Latvia and Estonia), in 1441, 1442, 1510 and 1514, the Brotherhood of Blackheads erected a tree for the holidays in their guild houses in Riga and Reval (now Tallinn). On the last night of the celebrations leading up to the holidays, the tree was taken to the Town Hall Square where the members of the brotherhood danced around it.[19] A Bremen guild chronicle of 1570 reports that a small tree decorated with "apples, nuts, dates, pretzels and paper flowers" was erected in the guild-house for the benefit of the guild members' children, who collected the dainties on Christmas Day.[3] In 1584, the pastor and chronicler Balthasar Russow in his Chronica der Provinz Lyfflandt (1584) wrote of an established tradition of setting up a decorated spruce at the market square where the young men "went with a flock of maidens and women, first sang and danced there and then set the tree aflame".
After the Protestant Reformation, such trees are seen in the houses of upper-class Protestant families as a counterpart to the Catholic Christmas cribs. This transition from the guild hall to the bourgeois family homes in the Protestant parts of Germany ultimately gives rise to the modern tradition as it developed in the 18th and 19th centuries.
18th to early 20th centuries
Germany
A little Christmas tree on the table, painting by Ludwig Blume-Siebert in 1888
By the early 18th century, the custom had become common in towns of the upper Rhineland, but it had not yet spread to rural areas. Wax candles, expensive items at the time, are found in attestations from the late 18th century.
Along the lower Rhine, an area of Roman Catholic majority, the Christmas tree was largely regarded as a Protestant custom. As a result, it remained confined to the upper Rhineland for a relatively long period of time. The custom did eventually gain wider acceptance beginning around 1815 by way of Prussian officials who emigrated there following the Congress of Vienna.
In the 19th century, the Christmas tree was taken to be an expression of German culture and of Gemütlichkeit, especially among emigrants overseas.[20]
A decisive factor in winning general popularity was the German army's decision to place Christmas trees in its barracks and military hospitals during the Franco-Prussian War. Only at the start of the 20th century did Christmas trees appear inside churches, this time in a new brightly lit form.
It has always been the Nativity scene, in fact the first tree to appear at the Vatican was in 1982 under JP2, that should tell you all you need to know.