They should be this...what sort of gnomes are these?
Yes, this is what Gnomes should look like. Or like Whizbang Dustyboots avatar picture. Or like this:
I don't think anyone disputes that they should look like the classic image of gnomes that have stepped out of a fairy tale. But aside from being a little bit dwarfish looking, and having the dwarvish traits of metalworking and gems, they should also have fairy magic. In other words, they should be a little elvish, in their love of nature, in their fairy magic of illusion, and their sense of humour.
They shouldn't be dwarves who spend a little more time on the surface without scottish accents. They should be more fey than that. They should be dwelves, a good bridge between the dwarven and elven archetypes.