In my campaign, yes I do use racial skils...
RACIAL SKILLS
The racial skills listed under each race are always treated as class skills for members of that race and they may be used untrained.
Human: none
Dwarf: Appraise, Craft (armorsmithing), Craft (blacksmithing), Craft (stonemasonry), Craft (weaponsmithing), Knowledge (architecture and engineering), Knowledge (dungeoneering), Knowledge (local - dwarves), Sense Motive
Elf: Balance, Heal, Hide, Knowledge (arcana), Knowledge (history), Knowledge (local - elves), Knowledge (nature), Listen, Move Silently, Search, Spellcraft, Spot, Survival
Gnome: Concentration, Craft (alchemy), Knowledge (arcana), Knowledge (local - gnomes), Search, Spellcraft
Half-Elf: Balance, Hide, Knowledge (local - elves), Listen, Move Silently, Search, Spot
Half-Orc: Intimidate, Survival
Halfling: Climb, Escape Artist, Hide, Jump, Knowledge (local - halflings), Listen, Move Silently, Spot, Tumble
I give all the races other various bonuses as well, although it was tough balancing some races - especially elves and dwarves.