Perhaps break them into Race, Class, and Faction subsets, where you pick a few from each 'pool' of racials upon character creation?
That way the racials that you really can't do without don't end up on just one race (Every Man for Himself for example) but not everyone has them, for example, a night elf priest might have an elune themed racial while a human priest might have one that's the same mechanically, but aesthetically different, but since a racial for priests might not be ideal for warriors, they might pick out something different when making their character.
Plus, we could have a gnome mage and a forsaken mage with the same 'mage' racial but could differ in everything else.
At the other end of the spectrum, two orc warriors might have similar racials overall, but differ in whether they took ones that'd be ideal for tanks or pve or pvp or whatever.
What do you guys think? I worry that having a subset tied to class, while cool, might end up too similar to passive talents.