(My apologies, but this is a bit wordy. Skip to the end for the gist of the suggestion.)
If I had to choose one feature of races in 3.5 that annoys me the most, it's the concept of racial enmity as a mechanical modifier. The Hatred and Defensive Training racial bonuses of the Dwarf and Gnome force a GM's hand in world-building and present illogical situations when incorporated into back-story.
As a GM, I don't want to have my hand forced in creating a consistent living world due to some minor rule dictating that "NO, the Dwarves CAN'T live on THAT side of the ocean, because the Orcs and Goblins all live on THIS side of the ocean, so how are you going to explain THAT?" Consider the most famous case: the Dwarves of Eberron, most of whom, despite never having seen a living giant more advanced than an ogre, nevertheless have defensive training that allows them to dodge Giants of every sort. That's inconsistent and thus, it is a cause for concern from those of us (GMs) who are struggling to create exciting, life-like worlds for our players.
So far, I've largely focused on the mechanics and "crunch" of Pathfinder, so I haven't read enough of the setting's background material to know for certain how well these rules worked into Pathfinder as a setting. But that said, I'm sure I'm not the only GM planning to use Pathfinder's mechanics to define my own settings with my own unique (non-Giant-fighting) Dwarf and Gnome societies. I'm not suggesting that Paizo should cater to people like me, of course, but it would be a nice if the core Pathfinder rules were adaptable enough to allow homebrew campaigns.
From the players' end, it's still problematic. It's great to have those little bonuses (if you can remember them at the appropriate time), but what if the DM decides not to make of use of Giants or Kobolds or whatever your bonuses work against? Your racial abilities have been balanced against other races by taking that Hatred ability into account, and if it becomes useless due to the DM's story focusing on, say, the undead, then suddenly your choice of race is diminished ever-so-slightly. The same is true of Defensive Training - if you can dodge a Giant, why not a Tyrannosaurus, a Nightwalker, or a Dragon?
That said, please consider this minor tweak:
- Drop "Hatred" from the Dwarf and Gnome entries.
- Replace the text of "Defensive Training" with the following: "You gain a +4 dodge bonus vs. enemies of size Large or larger."
I think this is a simple solution that both eliminates the "there must be Giants and Orcs here" problem, while balancing the loss with a more generally-useful version of Defensive Training (which I would personally rename "Underfoot," but your opinion may vary).