Ok. So rather than to hijack a different thread it thought it polite to start up a new discussion.

I said how I'd really like a fantasy based game / film / book set in our own pre-historic past that uses all the world's mythology and ancient legends and tries to capture them as a reality passed by.

Things like dragons played by dinosaurs (both are egg laying large reptile like creatures so is it possible we co-existed??). Ancient culture on every continent has legends of dragons.

Dwarves are from Norse mythology and are described as shorter in height (baring in mind the Scandinavians and Slavs are some of the tallest branches of people in the human race) but are also described as not being small (meaning stocky big boned?). They also lived in caves. It is now believed the Neanderthals co-existed with humans and they fit this description.
That or some Mongolian type people are generally smaller in height but can be very stocky.

Who and what people, animals and events could feature in the fantasy realm.

Discuss the possibility of such things having a basis of fact behind them

I'm pretty sure there's quite a few examples of what you're looking for. Let me find them, will update when I do.

Here's one movie called Outlander. It's not so much real life and fantasy mixed together, but sci-fi and fantasy. This tells of an alien that lands on Earth during the reign of the Vikings, bringing about the legends of the dragon.

http://en.wikipedia.org/wiki/Outlander_(film)

Elves are from Norse mythology. Elves in Norse mythology I think effect fortune. Dark elves I think are supposed to bring about misfortune.

They could be people of the stars or even people of the spirit realm crossing back and forth rather than an actual race on Earth. Many cultures of the Earth even today believe in spirit people. In Islam they have the Jinn

Something else that is in a lot of world mythology is giants. People who are as tall as 7-8 meters high. Norse mythology, Greek mythology and the Bible speak of them. I think the Americas do also.
They are often described as being offspring between humans and gods (spirit people / people of the stars?)

No, humans never coexisted with dinosaurs. What we have coexisted with are a bunch of animals that liked to eat us or at least give us the willies, like crocodiles, snakes, lions, bats, and so on. So what do you do when you want to make up some really scary critter? You take inspiration from what exists around you and you scale it up and maybe add some other fun stuff, like the ability to spit fire, make rain fall, or something. That's all dragons are really: big scary generic reptilian creatures.

http://www.independent.co.uk/news/world/europe/road-project-in-iceland-delayed-to-protect-hidden-elves-9021768.html

Icelandic construction workers refused to remove a tree because they believed it to be protected by Elves.

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