Don't shy away from [the questionable morality of killing kobolds], but don't water down the issue by just making the humanoids simply "misunderstood," either. Milk it for all the drama that it's worth.
He then goes on to recommend a number of different ways of messing with players' moral compasses for the sake of drama, including orc-meat, orc-children, and bounties on humanoid scalps.
This hits a chord with me. I've always believed that there should be more to a game than just the unthinking murder of 'evil stuff'. But at the same time (as I think Jim is alluding to) I believe that it is important that good and evil should exist as objective things in the fantasy genre: Even if you tweak the tropes, there should always be an awareness that irredeemable evil can and does lurk somewhere. Now, it might be the case that you want to have an evil dwarven emperor, morally ambiguous elves, and neutral/isolationist orcs in your setting. That's fine; to be encouraged, even. Likewise, it's important that not every 'evil' creature should be utterly steeped in sin, and that not every 'good' one should be a paragon of virtue. If you want a friendly goblin guide for your players during their journey through the mountains, all to the good. But objective evil does exist, and is a force in the world that sometimes has to be fought.
The key, I believe, is in making evil believable. I won't have any truck with what I read recently on a Story Games thread, in which it was advocated that:
The usual 'enemy races' are actually materialized negative energy from purification rituals- goblins are evil thoughts, orcs are evil deeds, hobgoblins - evil laws, and kobolds? Good deeds undone.
I don't necessarily think that is a bad idea (it's actually quite a good one for a certain kind of game) but it really isn't my scene. I don't want my orcs [or whatever the 'evil' races are in the campaign world] to be 'materialized negative energy' or personifications of 'bad deeds'. I want them to behave in 'evil' ways because it makes sense to them to do things that way. Why do orcs want to eat human babies? Because they're hungry, and they don't see human life as remotely precious. Why do they torture? Because they think it's fun, and it has religious significance. Why do they make war? To gain more resources for themselves.
This has the added advantage of allowing players and humanoid opponents to interact in more sensible ways. The party comes across a bunch of hobgoblins laying waste to a village; of course, they step in and try to stop them. But on another day they come around a bend in the road in the middle of the wilderness and are confronted by a different group of hobgoblins who are just out hunting. Because both the players and the monsters are rational, it's perfectly possible for both sides to negotiate without resorting to senseless killing. And the game world seems richer and better as a result.
I think this is what troubles me most about the 'minion' rules in 4e. (I keep breaking that promise I made to myself not to talk about the new edition. Dammit.) Minions are there to be killed. That is the meaning of their existence - to die and make the players look good by doing so. I know that this is deliberate and the designers have made it explicit that all notion of an independent reality outside of the players has been thrown out of the window. And if that's what you want from a game, more power to you. But the very idea of 'minions' is anathema to the type of thing I'm interested in. Monsters aren't just there to kill and die. They're there to be interacted with in my games. That implies a whole world going on outside of the player characters, which just doesn't chime with the idea of minions.