Now I don't know if your old DM limited things only to humans, but I'm guessing "no".
Since you bring it up, you may want to take a look at how he divi'ed up the world: it was quite interesting (and much of Cinder's backstory was built around it; same for some of the other characters).
Originally Posted by Inspectre
Well, that's sort of my point Grey Wolf - obviously anything that's not human in a world even vaguely based on the real one is weird and strange by definition. But in a fantasy world? The aliens as presented aren't really that much stranger than elves or tieflings or dragonborn. So I'm not sure how to preserve that air of "something truly strange and wrong" in a fantasy world.
Since you are asking me, I would say that what would make the x-ds alien to a fantasy world is technology. Here is a whole society who know nothing of magic. If they want to set fire to something, they don't have a guy in robes chant at it, they have a guy with a metal contraption breath fire from a tube. The potential for shock is enormous, in ways that original X-COM wasn't, sort of compensating for the fact that human shock at alien life would be lessened in a fantasy world.
There is a world of imagination
Deep in the corners of your mind
Where reality is an intruder
And myth and legend thrive
Originally Posted by The Giant
But really, the important lesson here is this: Rather than making assumptions that don't fit with the text and then complaining about the text being wrong, why not just choose different assumptions that DO fit with the text?