Low magic, high fantasy. What that means in a nutshell is that the everday commoner doesn't see magic much and the only reason the average commoner is at all familiar with magic and other races is due to the recent war. PCs are special. They're above average, they're out of the ordinary, they're exceptional.
So, the Azgundi capital, for example, does not have things like Continual Flame lamps on every street corner, or anything else that would say "magic is common." The only place where anything magical could be considered to be "common" is the Adventurers' Guild compound, and in the households of certain Lords, Ladies, and retired adventurers.
If it weren't for the centaur, the dwarf would be getting stared at almost as much. Most commoners have never seen a dwarf, much less a centaur. Halflings, due to their somewhat migratory nature, are somewhat more commonplace, though still seperate and not trusted.
Does that answer your question?