Arcana Evolved was published first.He did it in Ptolus first. Both gnomes and halflings (loresong and quickling, respectively) are subspecies of faen (elves) and many people in the world of Pramael can't tell gnomes and halflings apart from one another at a glance, something I've used to great effect in my campaign for years.
I think it would also be fun to have a gnome wizard fulfill the Gandalf role in a halfling town. Similar, but different enough to stand out, in multiple ways.
The original Monte Cook's Arcana Unearthed was published in 2003, the updated 3.5 revised version Arcana Evolved was published 2005.
Ptolus was published in 2006.