The first is about the existance of varying races in fantasy settings. Do you feel that various races are needed to make a complete fantasy setting? Or are humans with various culture enough to make a fun fantasy realm?
Conan, Fafhrd, etc. seemed to get along just fine in fantasy worlds with no elves, dwarves, gnomes, hobbits, orcs, etc. It's certainly not required, and only helps to highlight the significant differences between various human cultures if you go the route of getting rid of the vast majority of humanoid races.
The second is this. While I was thinking about creating my own campaign world, I started thinking about elves and dwarves - and I see them as the cookie-cutter fantasy races. Used almost ad-nauseum. Does anyone else agree? I am juggling with the idea of creating new races.
D&D portrayals of elves and gnomes and dwarves tend to turn them more or less into the ethnicities that the setting is painting in a broad brush anyway. Elves turn into some combination of native americans (or, more accurately, horrible Disney-fied caricatures of the 'magical savage') and celtic people, while Dwarves have scottish and / or german flavors.
If you want to downplay those 'humans with bumpy noses' versions of elves and dwarves, feel free to make them different, by diving back into myth and folklore. Dwarves are surly twisted men (and powerful magicians!) who live under the ground, and are easily recognized because they have the feet of crows. Elves are whimsical and dangerous fey men who live 'under the hill' and tend to slaughter cattle of neighboring humans who encroach too closely upon their lands. Those captured by elves disappear, sometimes to return decades later, aged not a day, and with no memory of their time among the 'fair folk.' You don't have to go out of your way to come up with something original or freaky (like elves from space or elves as plants, or dwarves carved from stone), just look up some folklore and turn the elves into otherworldly tricksters and dwarves into mishappen folk descended from carrion-eaters that fed upon the bodies of fallen gods beneath the earth and so 'stole' the intelligence of man, and magical powers besides.
If I do decide on making new fantasy races for my campaign world, does anyone have any tips, resources, or suggestions about creating new races that aren't too outlandish and could believably exist in a fantasy realm?
If you look at various genre fiction, you'll see some tropes that get used a lot. There's often a brutal savage proud (and sometimes honorable) warrior-race. Sometimes they are orcs, other times hobgoblins, occasionally klingons, kzinti or even Krynnish Minotaurs. There's often a higher-than-thou partially-ascended race, often with a culture that's much older and more advanced than mankind, and just as often, inexplicably held back, preventing them from dominating the world. Sometimes this elder race will be elves, other times Vulcans, occasionally Minbari. There's quite often a race that was brought up 'too quickly' and gained technology or magic or whatever far more advanced than their culture was ready to deal with, resulting in them suffering all sorts of cultural upheavel and running around showing off impressive stunts that they never really learned how to develop on their own, having been lifted on the shoulders of giants 'before they were ready.' Some interpretations of klingons or ferengi go this route, at other times the role is filled by men, who received guidance in magic from the elves, and then turned around and did awful things with it, or the narn, enslaved by superior centauri overlords, and now using nearly equivalent technology that their own people might not have developed for centuries, if not millenia.
Figure out what niches you want to fill, socially speaking, and *then* think about whether or not you want exotic races, such as plant people or shapeshifting people or whatever.