Generally speaking, many of these races do not intermingle. However the major cities of the world are exceptions to this. When travelling the world, often when you are in, say, Gith Territory, you will encounter primarily Gith, with a chance of running into an rather bold group of halflings. On top of this, there are races like the Ishtar and the Ashtar that have not territory. The major cities of the world (Keystone City, Anduin Par, Sigil Genasa, etc.) are going to be melting pots of the races, where all are welcome (although old racist thoughts die hard in many of the citizens). This should hopefully emphasize the differences between village living and city living to the adventurers while illustrating the daily difficulties of the "homeless" races, as it were.