Only core would be pretty boring, in my opinion. Workable, and you could have a good game with it, of course, but limiting the game that much would not suit me.
That said, where to draw the line is always the hard part, and different clases get different powers based on what else is allowed. For a druid or cleric, allI need is the PHB, and if I get Spell compendium, I am good to go.
Spell compendium is also good for arcane casters, though not to the same degree.
Allowing each player to choose a single complete or races book sounds good and helps widen the game, but then you end up having nearly all the stuff in play(in your campaign), even if only one character is accessing it, especially if they can do the base classes from those books. Anbd if you allow one player to take stuff form a powerful book like Book of Nine Swords or such, there are more apparent power differences.
Making a list of what to allow and not allow is getting harder and harder as more and more stuff comes out, and players naturally want to play with the new stuff (especially as much of it is better than the core PHB stuff.) Not necessarily more powerful, but more filled with options. If I had to fill the fighter role, I would take the D\uskblade over the fighter any day, not becasue of sheer power, but becasue the Duskblade has tons more options of that to do every round of a typical game.
. It was 50% so I didn't need to be familiar with all the books and it also let me not worry about feats and abilities that weren't balanced with each other.
