Thinking about S'Mon's approach-- and my desire for basic PC races to be more or less parallel-- I've tried to come up with a solid, playable ECL +0 Hobgoblin. The Wisdom and Charisma penalties reflect stifling discipline; the Hobgoblins have never had a chance to develop their intuition or their will due to strict adherence to their orders. It also changes the dynamic of the saving throw bonus, from a straight bonus to a compensation for an ability penalty.
This also establishes a neat four-point parallel between the different martial races: Dwarves are LG, Elves are CG, Orcs are CE, and Hobgoblins are LE. Interestingly, the strongest rivalries and/or racial hatreds are between the races which share an axis in common-- Lawful Dwarves and Hobgoblins, Chaotic Elves and Orcs, Good Elves and Dwarves, or Evil Orcs and Hobgoblins.
I know that the ability scores are, by the book, imbalanced, but I really think that the rules as written overvalue Strength and Dexterity and undervalue Wisdom. The relative dearth of special racial abilities, and combining a Wisdom penalty with a FG that has poor Will saves, leave this fairly on-par with other races. The first thing I'd do to nerf this design (if needed) would probably be to remove the EWP, and the second would be to lower the Move Silently bonus to +2.
HOBGOBLIN CHARACTERS
Hobgoblin characters possess the following racial traits.
—+2 Dexterity, +2 Constitution, -2 Wisdom, -2 Charisma.
—Darkvision out to 60 feet.
—+4 racial bonus on Move Silently checks.
—Hobgoblins gain Exotic Weapon Proficiency as a bonus feat, allowing them to use the exotic weapons associated with any Weapon Group Proficiency they possess.
—+1 racial bonus on attack rolls against Orcs and Dwarves, the Hobgoblins' most frequent (and most hated) enemies.
—+2 racial bonus on saves vs. fear and mind-affecting effects. The Hobgoblins' battle discipline makes them more resistant to magics that might distract them from their duties.
—Automatic Languages: Common, Goblin. Bonus Languages: Draconic, Dwarven, Infernal, Giant, Orc.
—Favored Gestalt: Fighter/Rogue.
—Level adjustment +0.
edit: To demonstrate the parallel, here are the non-human martial races' ability adjustments and Favored Gestalts for comparison:
Dwarf: -2 Dexterity, +2 Constitution, -2 Charisma. Fighter/Expert.
Elf: -2 Strength, +2 Dexterity, -2 Constitution, +2 Charisma. Ranger/Wizard.
Orc: +4 Strength, -2 Intelligence, -2 Wisdom, -2 Charisma. Barbarian/Ranger.
Hobgoblin: +2 Dexterity, +2 Constitution, -2 Wisdom, -2 Charisma. Fighter/Rogue.
The Dwarf gets a flat bonus to all Will saves to compensate for the Dexterity penalty; with the stronger armor rules in my games, their extra ability with armor is also a major benefit. I'm thinking of automatically upgrading the armor proficiency they gain from their class, allowing them to use Heavy Armor without spending a feat for it.
I think the Elf comes out a little light, and I'm trying to figure out something to balance them back out. I'm leaning towards a speed bonus.