Okay, so the racial armour bit is pretty nifty, except for the fact that every shopkeeper and their mother carries armour of every type, for every race. I think armour should be rarer for non-humans in shops (unless you're shopping in Gullykin, for instance).
The shields being suited to different races, however, seems to make less sense to me. I mean, whatever you do some of it isn't going to make sense, like a halfling with a shield that's as large for him as for a human, but why couldn't a halfling use a human small shield as a large shield? Two shields sized for either a 32 inch waist or 36 inch waist human are just as usable as the other. Not so for armour, of course.