Nice bit of flavor text, I especially like the forms of address, and the thought you've obviously put into their cultural development. Giving them access to runes in their racial levels is also a very nice touch, and something I'd never considered for my own AE games, but might want to implement now that I've seen it. *yoink*
I also appreciate the obvious influence of Arcana Unearthed/Evolved, Ravenloft, and WarCraft (Titanborn?), which are three of my main influences as well.
I'm a little surprised how much positive reaction that changing the Dwarves' to type Giant has generated. I ran a homebrew two years ago where I changed Dwarves to be type Giant, and my players didn't go for it. Their negative reaction sortof soured me on the idea, but now I think maybe it wasn't such a bad idea afterall (rather, maybe my players just have no taste

)
Overall, nice work, and I'd like to see more of this setting as you develop it.
Robert "Homebrew is the Best Brew" Ranting