You say that like it wasn't frequently a thing in Tolkien's universe. Heck even the Dwarves and Elves where BFF's for a time (Which is why the door to Moria, the biggest Dwarven city, is made using Elven magic - With specifically the password being the elvish word for "Friend") and even post-LotR they got back to being on good terms with each other thanks to the friendship between Gimli and Legolas.
There's also plenty of examples of elves giving up their immortality to go live with humans (Notably, Aragorn himself is a decendant of half-elves (Which are themselves evidence of human and elf partnership) and his wife Arwen is an elf who gave up her mortality to be his queen).
To say nothing about the whole thing of many people post-LotR going different places. Elves all left their cities (That were no longer being bolstered by the rings of power due to them being disabled with the destruction of The One Ring), some went back west to The Undying Lands, while others remained in Middle Earth and thus had to go live in human or dwarven cities.
Elves & Dwarves lived close to each other in Eregion and Khazad-Dum(Moria), The two elder races developed crafts together and passed on their knowledge to each other. The spirit of God-Creator Aule is strong in both races. The door to Moria, you mentioned, was built by Narvi & Celembrimbor as a symbol of frienship and the road between realms. We see here the naturally looking friendship and collaboration, not the salad of BG3 or Divinity announcement trailer. And something tells me that elves and dwarves always remembered their home, their own folk, and certainly did not create interracial families with each other...
"Plenty of examples?" I remember the direct quote from Tolkien' about "...Only three times in whole history". it's a Big Exceptions. And only the 1st time was "pure one". Two other times, including Arwen and Aragorn, were about half-elven bloodlines.
After War of the Ring most of Elves sailed to Valinor, to the God land. Grey Havens & Imladris(Rivendell) became empty with time. We've lack of info about Woodland Realm in the 4th AGE. Woodland Realm grew and flourished after War of the Ring under the rule of Thranduil. But perhaps, over time in the 4th Age, all the Woodland elves also left the Middle-earth, as did Thranduil following his son Legolas.
I haven't seen even one sentence in Tolkien's literature about "...thus had to go live in human or dwarven cities." I think, its your vision of fantasy, influenced by modern DnD ideas about whole world salad
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I never said, that some mix of citizens is impossible in the fantasy setting like Divinity. In reverse, there should be Some natural mixing to give the fantasy world a broader overview. But the new game, in my opinion, shoudn't be like BG3, where all the races are just reskinned humans... It will ruin the Fantasy world atmosphere of Divinity completely, because in BG3 only the player can properly role-play fantasy race member, using the custom character. As i wrote above, just look at Divine Divinity + DOS2, then compare with BG3 or anouncement trailer of Divinity.
The new Divinity should take the best parts of previous games - lore, some natural humor, the appearance of races, a way of presenting the fantasy world, relations with companions. And from BG3 - only the graphics, visuals, animations, face animations, gameplay ideas.
