First of all, before diving into the mechanics of Polymorph Any Object, make sure you are reading a version with the applicable updates and errata. d20srd.org is one place that has correctly applied them.
Then, we must look at how Polymorph Any Object is connected to the other spells of its line. Turns out, it inherits from Polymorph, which again inherits from Alter Self.
Then, let's go through...
The Bonuses.
First in line: Alter Self. Alter Self grants:
- Size
- Mundane movement
- Natural Armor
- Natural Weapons
- Racial Skill Bonuses
- Racial Bonus Feats
Then, from Polymorph, we additionally gain the new form's:
- Strength
- Dexterity
- Constitution
- Extraordinary Special Attacks
Finally, from Polymorph Any Object, we gain:
- Intelligence! Beware, this can leave you dumber than you were.
That's it.
So what happens to our human?
The human gains the qualities of the new race listed above.
The human's classes are not affected by any stage of the morph. This is made explicit in Alter Self:
Your class and level, hit points, alignment, base attack bonus, and base save bonuses all remain the same.
Humans are rather scarce when it comes to racial features to lose, with the exception of the bonus feat and skill points. They are maybe lost. It is not made abundantly clear in the rules what the human's bonus feat and skills really are. The 3.5 FAQ calls them an extraordinary qualities, which we lose as part of Alter Self:
You keep all extraordinary special attacks and qualities derived from class levels, but you lose any from your normal form that are not derived from class levels.
I will leave it to you to decide whether the FAQ is right on that point. I see little in the way of rules to support the claim.
Finally, Level Adjustment. No one knows how that is affected by the morph. It is not addressed by the rules. Despite how trivial it is to use PAO to permanently change into a related race, level-ups when so morphed just aren't covered. Does that mean it's unchanged underneath your new form? Does
[Polymorph Any Object] changes one object or creature into another
mean that the change really is all the way down to the Level Adjustment? I don't know.
Discuss it with your DM. And above all else, remember that Polymorph is broken.
Not much.
Let's go to the text!
True Polymorph (PHB p. 283):
If you turn a creature into another kind of creature, the new form can be any kind you choose whose challenge rating is equal to or less than the target’s (or its level, if the target doesn’t have a challenge rating).
The word "kind" seems to be pretty important here, so let's see if any other spells or other rules use it in this way:
Antipathy/Sympathy (PHB p. 214):
Then specify a kind of intelligent creature, such as red dragons, goblins, or vampires.
Locate Creature (PHB p. 256):
The spell can ... the nearest creature of a specific kind (such as a human or a unicorn) ..
Special Purpose (sentient magic items) (DMG p. 216):
Protector: The item seeks to defend a particular race or kind of creature, such as elves or druids.
Wand of Orcus (DMG p. 227):
While attuned to the wand, Orcus can summon any kind of undead, not just skeletons and zombies.
Examples we have of "kinds of creatures" are: red dragons, goblins, vampires, humans, unicorns, elves, druids, skeletons, zombies. So, that implies that that is the level of choice a spellcaster has when casting True Polymorph.
To address your examples, it seems like "elf" and "drow" are viable choices, but nothing more specific than that.
As far as physical sex goes, some kinds of creatures (marilith demons, androsphinxes and gynosphinxes, hags) are inherently constrained to specific forms, but in other cases, it's not specific to the kind of creature selected, so it's not something the caster chooses. As a DM I would generally either have the post-polymorph character be of no particular physical sex, or be of the physical sex most nearly equivalent to that of the character before the transformation.
Any other aspects of appearance are up to the DM. They might declare that polymorphed creatures bear some resemblance to their previous forms, or they might declare it to be completely random.
Also, consider this sentence from the related spell shapechange (PHB, p. 275):
You transform into an average example of that creature, one without any class levels or the Spellcasting trait.
So shapechange doesn't allow the caster to specify specifics of appearance, restricting them to an "average example" of the kind of creature they have chosen. It seems reasonable to infer the same kinds of limitation apply to the polymorph spells as well.
Best Answer
The main issues with Polymorph are:
Monsters aren't designed for PC use. Many monsters have abilities that are overpowered or disruptive in the hands of PCs, as they were designed primarily as opponents and weren't balanced with polymorph in mind.
Versatility is power. Polymorph is by far one of the most versatile spells in the book. A more versatile character is actually more powerful, since he's more likely to have the most effective solution to any given problem. Polymorph gets more versatile for free as you add new monster books.
Polymorph isn't as broken as it used to be, but there are still loopholes. Because not all monsters were written with polymorph in mind, polymorph has numerous, very specific limitations. However, some forms have powerful or disruptive abilities which aren't covered by these limits.
Some particular uses for polymorph:
There are a few ways to curb the excesses of polymorph without banning it outright.