When I was creating my thief variant, one of the things I looked at was max level of characters and what hit dice that left them with. For elves at 8th level magic-user it was 5 HD, with Dwarves at 6th level FM it was 6 HD, which is why I selected 8th for Hobbits for my thief as it left them with 5 HD.
At 4th level max, even with FM, this is a max of 4 HD for a character. I would give them an option that brings them into the 5 or 6 HD range, maybe that's for Cleric at 6th level or something.
That, or they should gain some major benefits that outweigh the fact that they will never be as powerful as even other humanoids.
I'd lose the see in the dark thing, personally. EGG went out of his way to say that no matter what the PCs race is they need light to see, and no matter the monters race they can see in the dark as if it were daylight. It keeps the charm and magical nature of adventuring being hostile and hardcore. It does create a nice benefit though, so I can see the temptation. =)
OK, time to try another go round (all races don't necessarily have to be balanced though). My guiding principle is to be roughly the same as a dwarf or halfling, and I want as few rules as possible
DWARVES: Max level 6, save as level+4, note pits/new construction HALFLINGS: Max level 4, save as level +4, +2 missile fire
note that halflings are front loaded, having best saves and killer ranged attack.
GOBLINS: Max level 5, find pits/traps as elf finds secret doors (speaks Goblin, Hobgoblin, Kobold and Dwarf in addition to Common and alignment languages)
Basically, I see a Goblin functionally as a variant on dwarves, so I give them all dwarf abilities except the saving throw bonus. Then I partially balance that out by giving them extra trap find power. I suggest we make up any other rules as we need them
Cpt John "Jack" Hammer 6A84A6 Age 22 male Rifle-1 SMG-1 Grav Vehicle-1 Tracked Vehicle-1 Gambling-1 Leader-1