Here's how it appears in my Campaign Sourcebook:
Half-Orc
Half-Orcs were used as shock-troops by the armies of the Dragon Overlords. In fact, many Overlords experimented with different breeding techniques to form the ultimate Half-Orc warrior. After the war, many half-orcs became mercenaries or committed ritual suicide.
Half-Orc Racial Traits:
Ability Adjustments: +4 Strength, –2 Intelligence, –2 Charisma.
A half-orc’s starting Intelligence score is always at least 3. If this adjustment would lower the character’s score to 1 or 2, his score is nevertheless 3.
Size: Large. As Large creatures, half-orcs get a -1 size penalty to AC and a -1 size penalty to all attack rolls.
Speed: Half-orc base land speed is 30 feet.
Darkvision: Half-orcs can see in the dark up to 60 feet. Darkvision is black and white only, but it is otherwise like normal sight, and half-orcs can function just fine with no light at all.
Orc Blood: For all effects related to race, a half-orc is considered an orc.
Automatic Languages: Common and Orc. Bonus Languages: Draconic, Giant, Gnoll, Goblin, and Abyssal.
Dragon Taint Vulnerability: Half-Orcs get a -2 penalty to all saving throws made to resist the effects of Dragon Taint.
Favored Class: Barbarian. A half-orc gets a bonus feat at barbarian level 1 and again at every barbarian level divisible by 5. A multiclass half-orc’s barbarian class does not count when determining whether he takes an experience point penalty.
Favored Weapon: The greataxe.
Ancestor Feats: The half-orc may select ancestor feats from any one human region.
Basically I envisioned the Dragon Overlords as experimenting with the human and Orc bloodlines, thus when the two mix it creates a stronger, more powerful offspring. Like Human genes unlock powerful Chromosomes in Orc DNA which makes a Half-Orc more badder than normal

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Also, I really don't think just because I made them large they need a level adjustment. They get a +4 to Strengtrh at creation (Net +2 to hit in combat), but are large, so they are easier to hit and get a -1 penalty to thier attack rolls (Net +1 to hit in combat). Most Half-Orc Players put thier highest rolled stat in Strength (16) thus raising it to 20 (+5). Say they take Weapon Focus at Barbarian level 1, that gives them a +6 to hit in combat.
I also don't measure the balance of my campaign on how large someone's attack bonus is, as it ain't gonna mean much once the NPC blasts him with some powerful spells

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Also, other races got changed also, as one of the plot points of the campaign is the Dragon Overlords messed with the core of magic, spreading thier Dragon Taint which mutated races.