Can you elaborate on this bit? I’ve never heard of a real world orc or drow parallel. Or how it would be offensive, unless maybe some kind of insult to Nordic people because “dark elf” = Svartalfar or something, but drow aren’t really depicted as Nordic in aesthetic...
As for racism in my games, I use it a bit. It’s ridiculous to think that so many distinctive people could hold hands & live in harmony, I mean, how could a person who suffered from a Dragon Cult not look sideways at a Dragonborn? Or dwarves that constantly fight Orcs in the undermines not appreciating the presence of a Halforc noble from a country far away? I have a list of a handful of insults & slurs for each race against each race (I’m not going to post it lest my fantasy racism be construed as real life racism) that I might use it a particular NPC is racist, as well as some preconceived notions about their behavior.