"My major issue with it at the moment is that it spawns too many Asian sims. By the second generation of my game, just about all the spawned sims are Asian or Arabic."
LOL. I agree. At first I was deleting a lot of the weirdly generated sims, but some of them kept resurfacing. Then I decided to recolor them and change their features and clothes to my liking. I didn't want my sims interacting with unusual looking sims. Now I feel better when I see them in my friends list... especially when my sims inadvertently interacts with them without my say so.
Note that the game will still generate others, but you can always select them from the manage list and change what you don't like about them.
The upside is that you don't have to create more sims to interact with in your towns, but you can make the ones that are there look more appealing. I think you can change some of there traits too, but I don't mess with that much because I'm okay with dealing with the different personalities.