Favored enemies don't make a whole lot of sense. The way this game is designed, with the constant increase in a player's power in comparison to the game world, the favored enemy is useless.
The ranger got bonuses against giant class monsters in AD&D. These monsters were always far stronger than the average low level character so they were seldom used early on. As players got stronger they were able to compete with these things more readily and they had an advantage over other characters of the same level.
3e made it a class feature that the ranger could choose from a list of potential threats to gain this advantage over, but they dropped the ball in several ways.
First, the player got significantly higher bonuses against this enemy as they leveled, while at the same time, the campaign moved away from these monsters as viable foes due to their CR.
Second they forced the DM of the player using the ranger to include these foes in the setting or the poor fool felt cheated.
Third the ranger is a woodland based tracker and hunter not some goblin sniping, orc mauling menace to all that is deemed unworthy. These things might inhabit sections of a game world but they certainly aren't the only thing there is and when it's time to gain a new favored enemy they aren't going to disappear to be replaced by the player's newest flavor of hated enemy.
Instead of favored this and favored that, in the character description, this kind of single minded devotion to the complete eradication of a species might be better served as a theme where anyone who feels the need to hunt down and destroy a creature type be given the feats to do so. It shouldn't be the ranger's job unless she wants it to be.
Rangers should be good at wilderness survival, hunting, and tracking. They should be so in tune with nature that they get one or two druid spells a couple of times a day once they reach a significant level, around 10th or so, and never get spells that are designed to replace the character's weapons, enhance them maybe, but not cause damage themselves.
That's the genius of Orzel's idea. You get different bonuses depending on enemy type, but the bonuses can work for every enemy you encounter. Basically, you've trained a certain way specifically to fight certain creatures, but your training comes in handy in similar situations.
I think it's brilliant. Lots of flavor, and lots of crunch, and crunch supports the flavor.
I'm taking the liberty of reposting Orzel's idea:
I prever favorrd enemy.
But it should not be focused.
Instead it grants features that can alway be helpful.
Favored Enemy: Goblin
Sense Cheating: The ranger are immune to bonus damage granted from advantage
Dealdy Surpise: The ranger deals 1d6 bonus damage when he rolls an initiative highter than 10.
Favored Enemy: Reptillian (to get trapsy kobolds, stank troglodytes, and water-ambushing lizardfolk)
Find/Remove Traps +3
Mook Slayer: The ranger deals 1d6 bonus damage when outnumbered
Hold Breath: The ranger can hold its breath for a number of rounds equal to four times its Constitution score before it risks drowning
Favored Enemy: Dragon
Fearless: The ranger has advantage against saving throws vs fear effects
Maw dodger: The ranger has advantage against saving throws vs breath attacks
The idea for Favored Enemies is neat; if they do have Favored Enemies, it'd be nice if it was something like that. That said, I hope Favored Enemies is one of several options and I can take Quarry instead.
Favored Environment: Hot Forest (Jungle)
Great Fortitude: The ranger gains advantage when rolling saving throw against naturals diseases and poisons.
Tiger Tactics: When attacking, the ranger gains an additional 1d6 piercing claw attack.
I've never viewed Favored Enemy in that light, as it doesn't make sense. I've always felt that it was a creature the Ranger spent time to study and learn about - for any reason - and it is his knowledge that gives him an advantage. Not outright must-kill-them-all hatred.