Quote: Nope. The point of a Role Playing Game is to play a role. What's the point of multiple races if they are all balanced in the end?

Not balanced in every respect, but not unbalanced. If a halfling is very weak physically compared to other races then he should have other advantages compared to them as well. That's just basic gameplay.

Sorry, but suggesting that balance should be ignored and that some races should "rule" in everything just because and that other races should be available purely for roleplaying reasons, and that challenges throughout the game should accomodate this imbalance... well, that seems a bit backward to me.

At any rate, it is sufficient to say that elves will NOT rule in everything. They have a number of aspects that one would expect to see in elves, but also a great many differences. We certainly would not subject them to silly fantasy stereotypes just because.