The reason it isn't clear is because of two different ways of reading the opening blurb:
1) Blah blah PC blah blah.
see it says PC, its written like PC races, its obviously meant for PC's, they're just bare bones because there is no feat support. Why would you read the opening blurb anyway
2)WE HAVEn't TESTED THESE. YOU SHOULDn't MAKE PC CHARACTERS WITH THESE. *WINK*WINK*
obviously if you read between the lines, these are meant for PC's to be played, they just say all that opening stuff for liability issues, like the "NO DIVING" signs at kiddie pools.
Yeah, its just a case of WoTC taking back a lollipop that was never ours anyways, its hard for people who were holding it to let go.
Circa early 2008:
Players: Hey, you took gnomes out of the game! What gives?
WotC: No, they're right there in the back of the MM. If you're playing a gnome, use those rules. We'll eventually publish a more fleshed out version, but we can't think of anything good right now. For now, the MM gnome is the official PC gnome. Also, for all you guys who insist on playing kobolds or misunderstood good-aligned drow elves that fight with twin scimitars but certainly aren't derivative of iconic characters from spin-off fiction, the stats for a bunch of other monster races are there too.
Also, as some people have suggested, I don't see Oversized as a particularly broken ability, except in synergy with other things. And anyway, if it's borked, why publish it, if you could just write a balanced version instead? Now we're stuck with it. Given that the suggestion is there, albeit behind police tape, to use these races as characters, why were they written with broken abilities in the first place?
Personally, I'm don't care one way or the other. I like balance, as I noted above. However, this whole scenario smacks of poor foresight and bad design. And, as I already said, we were promised that 4e was positively hewn from the still-beating heart of a foresight elemental, and tempered in the fires of careful game design.