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On reflection - why not drop both halflings and 'Orcs as a PC race' and just keep Svartalfer as a (wolf-riding) PC race - two birds, one stone.

(p.s. just to avoid any confusion - classic Swedish fantasy Svartalfer are closer to hobgoblins than their norse mythology name-sakes)

To those worried about the classic races being too like D&D, all I can say is wait for the hacks. I'll be doing my own grimdark hack which uses a career system (like WFRP) and a small number (3 or 4) of weird playable races based loosely on Norse mythology, possibly with influences from other European mythologies. I for one do not feel beholden to Tolkien's interpretation of Norse mythology, and I'm glad FL doesn't either. It's just a shame that hobbits/halflings (a pure Tolkien invention) will be in the book.

But if the halfings get an interesting background why not. I for myself like the idea that they are the surface dwarves, beardless and ostracised by the underground dwarves. The halfings have adopted a more human lifestyle and pray to the gods of the humans. I like the idea. Btw, I haven’t forgotten the l by halfings Someone on this thread has mentioned the name and I love it.

Sure, as I said, I love that we're getting a unique spin on Norse mythology.  And don't get me wrong - I love playing halflings (I play one currently in a WFRP campaign, and also played one in the last D&D campaign I was in).  I just see them as very much "traditional" western fantasy as dictated by Tolkien.  Orcs also fall under this brush - a Tolkien invention that has become a fantasy staple.
When I design my own homebrew settings, I generally go straight to the mythological source for my fantasy races, and then make them weird.  This gives my homebrew settings a much more distinct flavour than if I choose Tolkien's races and then give them a little unique twist, which seems to be the default for most fantasy roleplaying games.
Some of my favourite fantasy authors are those that write weird fantasy, top of the list being China Miéville, so this probably influences my tastes a fair bit.

Have you read John Hornor Jacobs? I really like his books about Fisk and Shoestring

Morlock dwarves?...
Bound to happen...lol

Indeed these pale dwarves don't need to be forefathers even though they are believed to be so. They may just be proto-dwarves that have adapted to underground life. I picture them being able to temporarily destabilize their skeletons, making it possible to squeeze through very small passages. Perhaps some of them are blind. I suggest we leave them a little unclear for the time being.

I did however get an idea about the adventurers having to follow them far down below to help them with something very wrong in the foundations of the land, something that otherwise might result in disaster also on the surface. Inspiration from ”Journey to the center of the Earth” and ”Descent”.

Albino and blind with a heightened sense of smell, that sounds creepy, 
Why not put a cherry on the cake, and say they also eat people? 

To those worried about the classic races being too like D&D, all I can say is wait for the hacks. I'll be doing my own grimdark hack which uses a career system (like WFRP) and a small number (3 or 4) of weird playable races based loosely on Norse mythology, possibly with influences from other European mythologies. I for one do not feel beholden to Tolkien's interpretation of Norse mythology, and I'm glad FL doesn't either. It's just a shame that hobbits/halflings (a pure Tolkien invention) will be in the book.

But if the halfings get an interesting background why not. I for myself like the idea that they are the surface dwarves, beardless and ostracised by the underground dwarves. The halfings have adopted a more human lifestyle and pray to the gods of the humans. I like the idea. Btw, I haven’t forgotten the l by halfings Someone on this thread has mentioned the name and I love it.

Sure, as I said, I love that we're getting a unique spin on Norse mythology.  And don't get me wrong - I love playing halflings (I play one currently in a WFRP campaign, and also played one in the last D&D campaign I was in).  I just see them as very much "traditional" western fantasy as dictated by Tolkien.  Orcs also fall under this brush - a Tolkien invention that has become a fantasy staple.
When I design my own homebrew settings, I generally go straight to the mythological source for my fantasy races, and then make them weird.  This gives my homebrew settings a much more distinct flavour than if I choose Tolkien's races and then give them a little unique twist, which seems to be the default for most fantasy roleplaying games.
Some of my favourite fantasy authors are those that write weird fantasy, top of the list being China Miéville, so this probably influences my tastes a fair bit.

But also bare in mind, that roleplaying was born out of Tolkien's vision, it's the basis of retro games,

Albino and blind with a heightened sense of smell, that sounds creepy, 
Why not put a cherry on the cake, and say they also eat people? 

Nah, ”sounds creepy” is fine. I'm pretty sure we would be as creepy to them. People often care more about kittens than lizards just because the kittens are fluffy and playful. I think ”sounds creepy” opens up for all kind of interesting misunderstandings and assumptions in both direction. Great adventures ensue!

But also bare in mind, that roleplaying was born out of Tolkien's vision, it's the basis of retro games,

Actually, I would argue that roleplaying was born out of historical wargaming, and D&D is the basis of retro games, not Tolkien.  Empire of the Petal Throne is a retro RPG which does not use Tolkien's fantasy world and came out the same year (1974).
Just because D&D was the first commercially successful RPG, doesn't mean all retro-clones need copy its setting to be called retro.  Forbidden Lands certainly never did - they claimed the "retro" tag based on their mechanics.
Anyway, we already know we're getting a familiar flavour of fantasy, I'm just saying that those wanting something a bit more weird or original (a fair few based on the posts here) should wait for the hacks.

But also bare in mind, that roleplaying was born out of Tolkien's vision, it's the basis of retro games,

Actually, I would argue that roleplaying was born out of historical wargaming, and D&D is the basis of retro games, not Tolkien.  Empire of the Petal Throne is a retro RPG which does not use Tolkien's fantasy world and came out the same year (1974).
Just because D&D was the first commercially successful RPG, doesn't mean all retro-clones need copy its setting to be called retro.  Forbidden Lands certainly never did - they claimed the "retro" tag based on their mechanics.
Anyway, we already know we're getting a familiar flavour of fantasy, I'm just saying that those wanting something a bit more weird or original (a fair few based on the posts here) should wait for the hacks.

Assumption, again,
Did you understand what I wrote?
Modern rpgs came from D&D, D&D came from the mix of a war game being used to play in Tolkien's world, and that evolved in to the first rpg,
(now, bare in mind, when I was a little kid I created a rpg, without knowing what an rpg was, used dice, had skills, if I could do this as a little kid, I'm guess many others though out history have done the same, they just weren't known by the general public, so was it the first rpg? Doubt it) 
The play style is the basis of retro, not the system, that's a miss association and common mistake, it's just those that had a good time with classes and levels think it was the cause for those good memories, if the system was to be credited they would be more popular, they are not mainstream, and don't have broad appeal, 
Classical western fantasy is Elves, Dwarves, Giants and Dragons, this is by default, (I'd also like to point out that Dungeons and Dragons is still the flag ship of rpg' s, while Empire of the Petal Throne, is not, could it be the weird setting putting people off? There is a good reason that game fails, (btw every company that got involved in that game went out of business)
So do you want retro fantasy, then it has to be based on classical fantasy, because that's where it started,(and btw, dungeons and dragons predates 1974, they were playing versions of this before it became public) 
So like it or loathe it, Tolkien is the roots of retro fantasy, that's just history,

I would love to see some lizardfolk or reptilian kin.

I would love to see some lizardfolk or reptilian kin.

Lizardfolk were part of the big Swedish game that Gulliksson drew for at the time and we have some nice illustration of them by his hand, so it might happen. The big game in Sweden incidently wasn't D&D although that's what I personally started with. Here we had ”Drakar och Demoner” – ”Dragons and Demons”, which I believe was built on Chaosium BRP (others know a lot more about this than I do). This said, the races were pretty much the same.

Erzaad: Concering your comment on dwarves in the Thoughts on Kin thread, I too was a big fan of Dragon Age Origins, and think more in those terms when it comes to dwarves.

Albino and blind with a heightened sense of smell, that sounds creepy, 
Why not put a cherry on the cake, and say they also eat people? 

Nah, ”sounds creepy” is fine. I'm pretty sure we would be as creepy to them. People often care more about kittens than lizards just because the kittens are fluffy and playful. I think ”sounds creepy” opens up for all kind of interesting misunderstandings and assumptions in both direction. Great adventures ensue!

That's what I was originally thinking, they eat people, was going to be a rumour, do they don't they?
Tradgic if they didn't and were shunned, but do you want to bump in to a group of these underground if they do eat people?
Mis judge a book by its cover?
Or scary man eating mole men lol