For me, it's split right down the middle. There are pros and cons to either having to choose from a list or creating your own.
When a GM gives a list of playable races, they're setting a guideline. But sometimes the GM doesn't just outline the race but ends up making a very narrow place for your character to fit in. Too much detail is what I'm trying to say. In those cases I feel really limited on what I can do with my character and then it just feels like I can't bring anything unique to the table. However, if you have a very specific plot and setting, a finely tuned machine if you will, then pre-set races are almost a must so there isn't a wrench thrown into the gears later on.
When a GM gives the option for creating your own race, it really is cool to see what the other players come up with. Sometimes it can be difficult because you don't know where to start and sometimes you're just inspired. Letting players create their own races, I feel, is a better option if you want to develop the story with your players because what they choose will eventually influence the plot and setting.
