So, in the short term my medicine to avoid going down the rabbit hole is to do a ton of reading on world building. The problem is there is a metric ton of stuff on world building out there in the Internet wildelands, but not all of it is worth your time.
I've collected a list of relevant books, articles and other online resources I've read, tuned specifically to world building and race creation / demographics for now. Hopefully you'll enjoy the articles as much as I have.
- "World Building", by Julie Ann Dawson from Bards & Sages, is a PDF/eBook that was developed from a syllabus of a world building seminar she ran at SUNY. It's only 16-pages in length, but for less than $1 I couldn't resist. It ended up being worth 10 times that in terms of what I got out of it. She basically covers world building in five parts: develop a clearly defined logic; Open, Closed, or Limited Access worlds; developing the logic; build the civilizations; and creating the crunch. As a long-time D&D player, my tendency was to do the last part first (the crunch), but she makes a strong argument against that approach and I'm better off for having read it.
- "Four Maxims for World Building" by B9anders over at Strolen's Citadel. While I disagree with the authors assertion that you should avoid detailing things the players will never know about , the rest of his post made sense to me for L&F world building.
- In "Four Easy Steps To Omnipotence", Drew Karpyshyn (Senior Writer for Mass Effect) lays out another four 'maxims' of world building. Common theme here? Yes: start small, stick to your common theme, be internally consistent, and use real world (or familiar) hooks to pull the player in.
- "World Building 101: Races" by Brandon Landgraff over at d20Source.com takes existing "stock fantasy" races and recasts them onto your unique setting. Although this is not necessarily what I was looking for, the article nonetheless proved useful because Brandon reminded me of the (often overlooked) issue of Culture vs. Race in fantasy settings: they are not the same thing . This article is part of a stellar series of World Building 101 articles by Brandon, worth checking out and bookmarking no doubt.
Again, there are TONS of resources out there on the net about world building - but hopefully these above links will get you started with some different perspectives.
If you have any other links that might be worth checking out - please leave a comment and let us know!
 I subscribe to the Tolkien, Donaldson, Hebert iceberg approach: 90% of what is known to the author is never seen by the reader. This is also why I'm so terribly affraid the whole L&F project could run aground if I get too caught up in the details.
 It is actually one of the things that bugs the hell out of me with the stock version of D&D: all dwarves live underground and drink stout for breakfast; all elf's love trees and are frilly wine drinking dandys, etc. You get the idea. It's one of the reasons why HardBoiled Cultures for 4E D&D is such a great resource.