Thoughts on fantasy races:
(disclaimer, I am very white, so take what I say with a pinch of salt and listen to the voices of marginalised people over me.)

So I think the problem with fantasy races is that they're *too much like humans*, and this invites dodgy implications.

Take the Orc. An orc, as presented in modern D&D, is basically just a person, but innately stupid and savage and violent and evil. This is, suffice to say, pretty problematic, because it's the exact same set of tropes racists and colonialists use to justify their shittery.

So, if I was to fix orcs, how would I do it? There's a few approaches I'd look at.

The first is to ditch them. You don't need them. Humans can be monsters by themselves. You need somebody nasty and violent and sadistic in your game for players to fight? Look at, like, everything europe does! Humans can be total fucking monsters left to their own devices!

Of course, if you're doing this, for fucksake don't tie into tropes that otherise non-white cultures. Going from orcs as a horrible racist caricature of non-white populations, to human enemies that are a horrible racist caricature of non-white populations is STILL FUCKING RACIST.

So just make them locals. Some humans are just sadistic & fucked up, & they often work together. Make the town guard horrible people abusing their power, present them as an enemy.
The Swedish army in Better Than Any Man does this well, and is better than any orc horde I've seen.

The other option is to make them dramatically not-human.
Perhaps orcs are vat-grown soldier homunculi, a mixture of blood and fat and filth shaped into a crude humanoid form, used as disposable shock-troops. Soulless, not properly sentient, crude fascimiles made only for violence

These /things/ aren't people, you can't mistake them for people. They don't have a culture, don't have families, probably barely speak, have no concept of other people as really existing. Their free will is likely tenuous.

(As well as being less racist, this concept of orcs is just fucking cooler imho).

This applies to other fantasy races, as well. If you're going to include elves, make 'em WEIRD. Pallid wide-eyed obsessive aesthetes spawned by human dreams (drow are nightmares, and not black-skinned because COME ON). Long fingered THINGS that lurk in the world's between-places.

By any human standard, elves are fucking insane, treating everything as if it were high art, treating the world as a malleable thing that can be re-shaped for better artistic effect (hence their magic, 'cos for them, it's *true*). Not understanding the practicalities of life.

And their bodies are strange, too, a melting-pot of fairytale weirdness; butterfly wings, antlers, leaf-shaped ears, extra fingers, petals for hair, cloven hooves, third eyes, tails, skin like tree-bark, iron hooks for fingernails.

You can't possibly mistake them for humans.

Which ties into a problem I have with modern D&D: by having non-human PCs use the same classes as humans (with only slight race-based tweaks to their stats), you imply that they're basically just people, and the parallel to real-life ethnicity becomes an easy one to draw.

Which is part of why I like Race-As-Class. In b/x, an elf or dwarf or even halfling can do stuff which a human just CAN'T. They don't share any career options with humans, they feel weird and odd. They seem slightly inhuman.

Lean into this. Don't let your demihumans seem human, keep them weird and alien.
(Besides the not-being-racist thing, what's the point in playing an elf if they're basically just a pointy-eared human that's good at archery? If that's all you want, play a human.)

in conclusion, here are some thoughts I had a couple of years back on the problem of orcs being evil, and the ramifications that has for fiction:
https://cavegirlgames.blogspot.com/2018/05/orcs-violence-and-evil.html