I've tried to convince people for years that limits on demi-humans were not intended as "balance" measures. "Balance" being in any way even promoted much less achieved by these measures is utterly laughable. People were complaining about those limitations almost the day they were in print. I have challenged people to provide me ONE quote from Gygax stating that they WERE, in fact, attempts to balance the power of demi-human PC's against what would otherwise be weaker human PC's. Even quotes from others (not Gygax) contributing to 1E AD&D rules decisions saying so. Nobody has ever provided such a citation.
Balance is the post hoc attempt by PLAYERS to attempt to justify or explain the limitations that otherwise on the surface seem inexplicable rules. Rules which everybody and their brother immediately took steps to bend or break or just FLAT OUT IGNORE as dumb. Over time, what I noted in reading and listening to endless arguments about this, is that Gygax personally really liked human PC's more than demi-human PC's. He really didn't "get" the tremendous appeal that demi-humans had for others. He tried to convince readers to his way of thinking by telling them that they really couldn't legitimately think as a NON-human. Go ahead and re-read DMG p21+ ("Monster as Player Character"). He wasn't really even talking about it in terms of BALANCING demi-humans and humans, but presenting it in terms of players BEING human and therefore thinking as humans and not as non-humans or monsters. He didn't talk about WHY humans should be the dominant force in the game world - he simply STATED that they would be and that it was just SO obvious that people would naturally see it his way. If they WANTED to even let player characters BE monsters, well, they were free to do in their own campaigns what they wanted, but that was then entirely their problem.
So, those demi-human restrictions weren't for BALANCE - they were SETTING DESIGN TOOLS. DM's could do what they liked in their own games - and what happened was then THEIR fault. But for the default D&D settings that were all that Gary saw, it was humans AT THE CENTER, and everything else in more distant orbits.
Now, Gary published original D&D in 1974. He had his own game world of Greyhawk. Dave Arneson's game world was Blackmoor. OD&D saw a quick succession of rules supplements to add to and modify the original three booklets. And that's just the official stuff. Everybody who ran a D&D game was inventing their own rules and borrowing rules from others. AD&D began publication in 1977 - just THREE years after original D&D began - with the MM. The PH came in 1978 - 4 years after. Now go back upthread and look at Gygax's stated expected pacing for PC advancement. Clearly not everybody saw that same pacing - but it's what GYGAX saw in his own Greyhawk game at home, and in Arneson's Blackmoor game. When first asked about pacing of advancement he SAID that the two oldest games in existence were Greyhawk and Blackmoor and the PC's in those games had not yet breached 20th. Of course they hadn't. In fact, they were still operating under overwhelmingly OD&D rules, NOT AD&D which either hadn't yet begun to be published or only BARELY had. By the time the DMG is published in 1979 the ENTIRE HOBBY is only 5 years old, and here it is being given its THIRD re-write (from the original game, then Holmes, Basic D&D, and now AD&D). Gygax even said that with AD&D he was trying to again present a set of rules that could once again make tournament games, for example, consistently use the same rules from one game to the next because the rules creation and customization had made it all a bit untamed like the Wild West.
Yet people seem to think that the early years of D&D were just the same as watching WotC operate now - massive PROFESSIONAL design teams, YEARS of design and analysis, staggering amounts of promotion, and ALL of it carefully planned and designed from the ground up. That is NOT how early D&D got made. They threw naughty word against the wall and ASSUMED it would all stick. And they continued in that stupid and ludicrously inept style of running THE RPG game business until they went so completely bankrupt and broken that if it weren't for the equally stupid and ludicrous amounts of F-U money that WotC had made from MTG and Pokemon, D&D would have died forever. In short, people ascribe to early D&D an insane degree of skill and intent that simply and demonstrably DID NOT EXIST.
Meanwhile, the advancement pacing that GYGAX saw, and the STYLE of play that Gygax had still been talking about with the AD&D rules was already losing ground among players. Players DID want faster advancement pacing, and more reliably beneficial ability scores for their PC's. They also wanted MORE NON-HUMANS to be PC's and they didn't want those PC's to be so pointlessly held back compared to human PC's. They also didn't want to play "Gotcha!" style. They'd had enough of DM's pulling that no-win scenario crap for no other reason than to abuse the power of their position. They had begun to MOVE ON from that, even while the new AD&D rules were attempting to keep it enshrined, and ALL the power at the whim of the DM. They wanted their PC's to do more than just die like flies trying to survive, they wanted their PC's to stand GOOD chances of survival, and without the DM pulling new rules and monster attacks out of their ass to ensure their PC's deaths, and to see those PC's advance BEFORE the game fell apart because all the members of a group gave up the hobby, or moved away, or had to devote their free time to other, more important pursuits.
It is simply a lack of understanding that leads people to ascribe to planning and intent what for early D&D was just blind guessing and experimentation without serious contemplation and study.