I think that a lot of valid points have been made for both sides of this argument, & IMHO, it seems to me that some core issues with the game are derived from subjective interpretation.
It's not limited to D&D & RPGs--this is all too common with literature. Heck, books get banned (or generate arguments about being banned) because of such things.
To a degree, I think that (at least in the case of literature) it's an issue of assigning modern values on an older work (written & created at a time when there were a different set of core values). The problem with trying to enforce "modern" viewpoints and evaluations on a literary work (or an object of art, for that matter) is that those values
will change over time, and what is acceptable/unacceptable now may not remain true in the future. Our great-grandchildren may either see us as remarkably uptight or immorally hedonistic (in comparison to thmselves, based on the predominant values of their time).
In a weird way, I think that modern folk often think of themselves as being more enlightened/informed/noble (if you will) than previous generations. Because of that, there is a tendency to condemn things based on moral grounds (or at least, on the claim that we are more enlightened/open-minded than our ancestors). I'm sure that such a mindset existed with our parents about their parents & grandparents; I'm sure we have the same feelings (to a degree) about our parents & grandparents; & I'm very sure our children & their children will continue to do & feel the same.
I do wonder, in addition to the interpretations of race in D&D, how people with dwarfism view D&D's treatment (and fantasy RPGs treatment, overall) of people/races/species with comparable physical traits (i.e., does a person with dwarfism see gnomes, halflings, & dwarves as embodiments of stereotypes of people with dwarfism?). What about the reverse? Does a person with gigantism see ogres, giants, titans, & other races/species/people with comparable physical traits as embodiments of stereotypes of people with gigantism?
From what (limited) research I've done online, it seems that a very pervasive (and often used) stereotype in various forms of media (whether books, movies, games, etc.) has been with people with albinism. Elric seems to be a core embodiment about misinterpretations about people with albinism (pink eyes, frail or weak health, etc.). Would/does a person with albinism see stereotypes about people with albinism embodied in such D&D species as the Derro, or OD&D's Shadow Elves?
OTOH, what about D&D's (& possibly other RPGs) presentation of polytheism, interpretation of religious figures, & issues of spirituality? Does a Wiccan see the wizard/sorcerer/druid/shaman/adept classes embodying stereotypes about Wiccans? Does a person who practices Asatru (essentially modern-day followers of "Norse" deities/faiths) feel slighted when D&D or Palladium stats up the Norse gods? What about people who practice Hinduism or Shinto--did 1st & 2nd. ed. AD&D commit slights what it stated up deities/religious figures from those faiths?
I don't think that any of these issues about identity, and how identity is seen/interpreted (e.g., the "self" and the "other") will ever go away. I'm not saying that anyone's views are invalid (not at all); however, I do think that there are more issues than many of us frequently think about.
For the record, I'm person who just happens to be heterosexual, white, & male. However, I'm half-Irish (my paternal grandfather immigrated from Ireland, and both of my paternal grandmother's parents were Irish immigrants)--believe you me, the Irish have received their fair share of bias. Just because I'm Irish doesn't mean that I'm (1) Catholic, (2) drink large amounts of alcohol, (3) (often) wear green, (4) have red hair &/or green eyes, (5) have a bad temper, esp. after when said large amounts of alcohol have been imbibed, (6) have a large number of siblings, or even (7) originate from the Northeast U.S. (ala Boston). Just because I'm part Irish doesn't mean that I want to be frequently associated with shamrocks, St. Patrick's Day, leprechauns, green derby hats, Guinness, or even the IRA.
On top of that, I was born & raised in Texas (San Antonio area, to be exact). That doesn't mean that I (1) listen to country music, (2) ride a horse, (3) wear cowboy boots, Tony Lama's, &/or a cowboy hat, (4) drive a truck (esp. a truck w/ a Hemi), (5) have a uber-patriotic feeling for my home state as much (if not more than) as my country, (6) live in a desert or at least surrounded by cactus, (7) wear a fair amount clothes or own a fair amount possessions that incorporate the state's shape, lone star, &/or state flag in/on them, (8) regularly attend a rodeo, monster truck show, or wrestling event, (9) played/watch/or otherwise be obsessed with football, or even (10) own firearms (esp. some sort of shotgun, lever-action rifle, or revolver).
Heck, I won't even go on about all of the negative connotations/associations that have existed for people who're left-handed.

(Much less the negative vocabulary that has derived in reference to left-handedness, such as
gauche &
sinister; or just how often any sort of villain/bad guy has been depicted as left-handed).
As for MHO on the issue at hand, I don't really see anything more than mere "mythic" associations when it comes to the drow (i.e., going along with the classic idea of light vs. darkness, & the typical color associations based on that). IMHO, the drow more or less reflect the general idea of the "svartalfr," (sp.) as compared to the "ljosalfr" (sp.) of the typical high elf. One thing that has (& still does) bother me about D&D is the use of stat-based "subraces" to detail different nonhuman cultures (while humans are generally lumped together into 1 stat set)--I'd prefer elves to be just elves, & not high elves, wood elves, drow elves, etc.--if anything, these cultural differences could easily be reflected by choices during character creation (picking certain physical traits, favoring certain stats to be higher, frequently selecting certain skills/feats/spells/gear, etc.). Heck, I'd prefer to see the non-human race stat sets be made a bit more "generic" so that some player choice can go into developing the character (like making the elven proficiency with bows & swords as a special bonus feat they can choose, or the dwarven bonus to attack orcs & goblinoids as special bonus feats available for selection, etc.).
Nevertheless, I think that the game is ultimately what the players & DM make of it, & it seems to be the perfect means to use/insert/apply their own personal views/interpretations into it. The game is what the players & DM make of it.