Racism in-game, wouldn't that be an IC reflection of OCC sentiments? As in the character is merely acting on the prejudices of the player? You also have to consider the development of "My race is better than yours" as an in-game equivalence to the development of nationalism in world history. There you see the development of "us" vs "them"...if you have no idea what I'm talking about please look it up before you start arguing =). I would hesitate to call this sentiment racism, owing to the negative connations that are present when it is used; what better word can subsitute the pride and joy of being of a particular race?
Personally, as a player, I don't like the enki race, possibly because they have received more attention then any other in the development phase(bias perhaps, but it's true). Therefore, my char(s) will have some prejudice, but the degree of which will be determined by their personality moreso. As well, there will be some racism (for the lack of a better word) considering that there are certain races that -can't- interbreed (or are asexual). As in, if a klyros wishes to have a family s/he will have to and only marry another klyros. The other races of Yliakum have a wider selection available, owing to their genetic makeup. I am of the opinion that owing to this species difference, there will be -some- racism. But it should not be intentionally from players themselves, I'm not saying that. In this case, it was created (sorry guys) by settings.