Even if YOU don't have the MM, someone in your group definitely should. As such, there's no problem creating a gnome (or shifter, of changeling, or warforged).
I have the MM in front of me right now. The differences between PHB writeups and these entries are the following:
-No fluff (although it is present for the monster entries of the races)
-No suggested names or classes
-Slightly smaller special abilities list (ranges from 2 (Dragonborn, Half-elf, Halfling, although it could be argued that the latter actually has only one special characteristic they split to make it look like two)) to 5 (Eladrin) for PHB races; MM stats have only 1 or 2 characteristic per race). All races have a racial power (Half-Elves and Humans are slightly differ; they get to choose an at-will power from another or their class, respectively).
-No racial feats
... And that's pretty much it. To be honest, none of them really matter. Fluff and names are far from necessary; the slightly smaller set of special characteristics is fine, as some MM species are surprisingly strong anyways (I will personally never allow the minotaur in my game; he has +2 to con and str, AND can wield weapons one size category bigger then his (medium); this makes him a completely overpowered meelee combatant (whatever the class).) As for racial feats, they're not all that great. Some of them are spiffy, but in general, you might just as well take standard feats.
