I used to play this Nordock server with PRC installed and as far as I know we used both systems at the same time. (This was not good because the buffed stats from Shirley's and the PRC's unbuffed racial stats stack, giving the Drow and Duergar double boni, but it was all about getting the right factions and spawning point.) So it worked one way or the other.
So I assume that some script would be checking for any subrace, if set to "Drow" it would set faction, add stats etc. Same goes with Duergar. But if no subrace was set it should set the spawning point to Benzor and not add bonus abilities. The last thing does not happen, but brings up the dialog and the options to set both race and subrace instead.
The idea about letting the faction script detect the race is really a good idea, although I don't know how to set the correct spawning point once the race is detected. But I have not looked at the script yet and as I mentioned before, I'm new with this.
I'm going to see if I can find out what script is doing what and how I can change it to work as it should again.
Again my thanks for your advice. I really appreciate it.