The Story
(This story sounds more science fiction than fantasy, this is my way of explaining the creation of a fantasy world. It's based on my idea for a book that maybe I'll write someday... Of course some details of the story can be changed to include ideas from other team members. Also I'm not a native speaker, so probably it's not written in perfect English - if you notice something that should be corrected or written in a better way, let me know.)
1. The Ethereals
The Ethereals are conscious, intelligent beings composed of pure magical energy, who originate from a place near the center of our galaxy. They don't have any metabolism - they just exist without the need to do anything to stay alive. It's a contradiction to our second law of thermodynamics, but due to their magical nature they live in two planes of existence - the one we all know, and the "other side of reality", where time flows in an opposite direction. This allows them to balance the entropy flow on both planes, and remain in their unchanged form for any amount of time. They don't have any sense organs, they just "feel" the reality around them, and can change it to some extent.
2. Anticipation of the invasion
For billions of years, they did nothing but explored the galaxy and its vicinity - The Magellanic Clouds and some other small galaxies, and also the Andromeda Galaxy, where they observed a civilization that formed there, and slowly took over the entire galaxy. To their concern, that civilization started making plans to conquer our galaxy - the Milky Way. This changed their situation dramatically - before that, the Ethereals didn't have to do anything to ensure their survival, while the invasion was a danger to their existence, as the civilization from Andromeda used technologies that "sucks" all magical energy from the space, so it would destroy them - they couldn't escape because they can't exist too far from their place of birth near the center of our galaxy. Both the Ethereals and the Andromedans knew techniques that allow travelling faster than light, but the Ethereals could move much faster, so they had some time - several thousand years - to go back to our galaxy and think how to stop the invasion.
3. The Ethereals and Earth
The Ethereals had no power to fight against the Andromedans themselves, so they decided that the only way to do it is to use a civilization, or several of them, from our galaxy, that will defend it against the invasion. But there were no well-developed civilizations in the galaxy so far, which led them to the conclusion that they needed to create them. They divided into several groups that were sent to different regions of the galaxy. In our region, there was only one planet where there were beings that could create a civilization - the Earth. Humans living there were quite intelligent, but they haven't created a civilization so far. The Essentials figured out the DNA code, and made some genetic manipulations to the Humans that increased their intelligence, which led to the creation of a primitive civilization soon, that later developed into a more technologically advanced one. The Ethereals intervened on Earth later as well, which led to the creation of some religions and myths, but that's another story...
The Human brain has an interesting property - in large quantities, it creates a physical field that seals the connection between the two planes of existence, which makes it impossible to use magic. So in the early history of humanity the magic was used to some extent, but later, when the population rose, it no longer worked and was remembered only in the form of stories and superstitions.
4. The playground
The changes in Human DNA were quite simple, the Ethereals had more ideas how to change it, but these ideas were quite different from each other, and they couldn't agree which one is the best. So they decided that they would develop different kinds of Human-like beings - the races, that would live on different planets.
They found some planets that could be used for this purpose, but they needed some terraforming to make them a good place to live for humanoid races, which was going to take some time. Only one planet - Adea - had good enough conditions to be used only after some slight adjustments, so they decided that they would create their races and put them all on that planet, along with many other life forms transferred from Earth (some ways of communicating between Earth and Adea existed later as well, hence some cultural similarities between the civilizations of both planets). They planned to move these races to the planets prepared for them, when the terraforming process ends.
5. Early history of Adea
Using the combination of genetic and social engineering successfully is not an easy task. The first attempts to create new races were not very successful - they made them too intelligent and pursuing knowledge, without caring about the emotional side of their nature too much, which caused the technological advancement to be very fast (much faster than anticipated), but social development was slower. Undeveloped societies having access to very dangerous weapons, which often were used irresponsibly, caused a cataclysm that destroyed these early races, and left some ruins and other places of interest on the surface of Adea. Also, the first races of Adea conducted many experiments, which led to creation of many different kinds of monsters that still exist in the world, some of them are magical in nature and can be summoned with spells.
Before creating the races, the Ethereals knew nothing about ethics - the concepts good and evil were completely unknown to them. The first experiences taught them a bit about such things, but still they couldn't agree which approach is the best in terms of repulsing the invasion. Some of them thought that the best idea is to create ruthless individuals, that use every opportunity to achieve victory, and eliminate the weak among them. Others preferred emphatic beings, who care about others, which makes a good motivation - when the society is good to its members, it's worth fighting for. There were other disagreements between the Ethereals (now perceived as the Gods by Adeans) as well, so every race has a slightly different social values than each other. Also the ethical alignment is not completely determined by genetics, the races can choose their fate themselves to some extent. Other differences between races are caused by different geographical conditions in the areas where they live - the Ethereals placed them in regions with conditions similar to the anticipated climate of the other planets after terraforming, and made them well adapted to these conditions.
That's how the second generation of races on Adea was created. Will they live in peace with each other before the Gods allow them to travel to the Promised Lands? Will there be only local conflicts, or a big war that leaves only one victor? One thing is sure - there won't be another cataclysm that destroys all of them, the Ethereals learned a lesson and won't allow it again.
