Currently, losers of a war are seamlessly integrated into the conqueror's society. I'd like to see a more realistic response spectrum, ranging from grudging tolerance of the other races' citizens to genocide and everything in between
For example, a human civilization that manages to win the long drawn out war instigated by the elves would likely not want to make them kings and diplomats any time soon. They'd be far more likely to enslave or outright kill them all considering the massive ethics differences
Any slaves taken in wars should affect politics. For instance, dwarven slaves captured in a war with the humans (does this actually ever happen?) would sour relations with other dwarven civs and inevitably lead to war or diplomacy in an effort to free them. War grudges should not be forgotten lightly
Even if the winner doesn't opt for genocide or slavery, relations between the species should be sour for some time. Slave uprisings and other struggles should be common. The number of slaves should be restricted to a percentage of the parent civ's native citizens for control reasons, otherwise the everliving elves will simply outbreed their masters and inevitably win the slave revolt
It's a fairly complex matter but anything is better than the current instant brainwash method and the resulting elven kings. Even automatic genocide would be a better approach