Good question, and there doesn't seem to be an official answer as far as I know but we have some information to speculate.
Gnomes were the last playable race to be added to the game which is why they weren't in the original cinematic.
From the
Behind the Scenes :Characters video it is clear that the silhouette's of playable races were very important and the would even change race models to make them more distinc. Since Humans and Night-Elves were decided pretty early on High-Elves would probably have looked too similar in terms of silhouette. I think it's clear that in terms of silhouettes Gnomes are/were more distinctive than High Elves given the other vanilla races.
Goblins were seriously considered both as a neutral and Alliance race though which also explains why they could equip a lot of player armor models already back in vanilla. In an
interview John Staats revealed that Goblins were scrapped as a playable race because building their starting zone starting zone Kezan/Undermine was simply too expensive since they didn't have a lot of art assets.
Gnomeregan was planned to be in the game anyway, and perhaps already build before Gnomes became playable so it was probably relatively easy to place them in Tinker Town inside Ironforge using existing art assets. There were no High or Blood Elven art assets in the game, even the lodges in Hinterlands, Plaguelands and Loch Modan are all Night-Elven in style so it could be that building Quel'Thalas for either High or Blood Elves would have been too expensive.
Btw, there is an image of an
old map of World of Warcraft from 1999 which shows (High) Elves, Humans and Dwarves as team blue, Orcs, Goblins and Tauren (and perhaps Night-Elves) as team green and Naga, Undead/Forsaken and Demons as team red. This does confirm information from John Staats that blizzard originally planned 9 races including Naga, Goblins and demon shapeshifters and didn't settle on a 2-faction system from the start.