Sneak allows you to do faction quests or sell items to unfriendly merchants... which is really not that big of a deal when you're not an evil race anyway. It is certainly the least useful ability between Sneak, Hide, and 10% exp bonus. Hide I use constantly; it's the best racial in the game after frontal stun immunity.
However, I would still take Sneak over clicky Darkness, though I think that is a superb ability as well. Yet in the end I would rather be a Dark Elf than a Halfling, simply because of height considerations and playing in first person view. Dark Elves tend to look better in plate armor too.
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