Me personally I'd have to say the beast races. Not for its 'cool' factor per se (though it helps...I mean what other game lets you play lizard and catfolk?), but just the way Bethesda made the lore so compelling. I swear I'd love TES VI to be set in the Black Marsh or Elsewyr. Argonians especially are more compelling since they are a relatively uncommon race in Tamriel, pretty much a minority and persecuted everywhere they go yet they have a lot of personality packed into them. Khajiit are cool too (not as cool as Argonians in my honest opinion, but still cool), they have awesome accents (Middle Eastern/Spanish sounding), have a lot of potential, and their inherently geared towards the type of characters I enjoy playing most (stealth thieves/assassins).
The humans are pretty cool, and what I like about them is they aren't lumped into one generic 'human' race. I am disappointed that there are no Indigenous/Native Amerindian and Asian 'race' of humans in Tamriel, but for what TES has so far the human nations are pretty cool. Redguards make for excellent protagonists and adventure stories (though I admit...they suck in Skyrim as far as voices and NPCs go), I'd love to explore a Skyrim engine version of Daggerfall (land of the Bretons), Nords are Nords (enough said), and for a pretty basic generic human race, Imperials are quite compelling. Like how they used Romans as the default as opposed to the stereotypical English that's so commonly used in other wrpgs.
The mer folk I admit aren't as compelling...except for the Dark Elves. Lots of lore surrounding them (and there's Morrowind). Altmer and Bosmer just don't strike me as interesting. I do appreciate though how they can have facial hair and muscles instead of tiny, short, pixie like beings (D & D elves). Oh...and Orcs. Orcs are pretty awesome although I usually don't associate them as 'mer' (played enough D & D to separate the two although its not so in the world of Tamriel) :-)
My thing is, I'm pretty scattered as far as favorites go. Argonians are my favorite race, but I like Redguards and Bretons better than Khajiit, and Orcs are right up there on one of my top favorites. If I *had* to pick, it would be beast if only for Argonians. But as a whole, humans since I prefer human characters.