My Drow character didn't have any qualms killing Tiefling children, if only those goblins hadn't gotten to them first. But I'd hate to make this another 'Drow aren't Drow anymore' thread.
A lot of this seems to be coming down to the Nature/Nurture dichotomy. Something that isn't settled in our world, but which can be settled in a fantasy setting. In D&D creatures could be a certain way because of their nature. But that is becoming less and less true.
This of course is related to free will, something that also seems to be taken for granted by some. GM4Him said that the races with good or neutral gods were imbued with it, but that evil gods didn't give it to their races. That was an interesting way of approaching the subject I thought.
The precise details here should be left to the DM, and not mandated as part of the game system.