Every time people lament changes to the lore that amount to "not every member of species X is irredeemably evil" and claim the game is removing villains from it, I think how villains of so-caleld evil species fall into two cathegories: a) bland and boring and b)have something else, unrelated to their species going on for them, that makes them interesting.
Evil races give someone the PCs don't have to feel bad about killing. Obviously depends on your party, but if they befriend the hungry wolf pack and negotiate with the bandits, then a band of definitely evil goblins gives the barbarian something to smash without worrying if they're killing little Timmy's dad.
Edited to add: And if "he's an evil race" is your only reason for them being a major villain, that's bad storytelling. About as bad as "yes they're going to help you because they're good," and not for some kind of benefit to them, monetary or spiritual or whatever.
If you can kill something without feeling bad because of its race, that's fucked up. A group of goblin bandits can be fun, but they're villains because of the bandit thing, not the goblin thing. Why should a group defined by plundering travelers be more acceptable than a group defined by being short with green skin?
That said, the undead are, more often than not, fair game. Undead are a mockery of the life that came before and a defilement of their corpse, so killing them is a way of honouring the dead.
You should probably have specified mindless undead, not just all undead. In fact...anything mindlessly violent. Demons, zombies, etc.