Before 300 years ago, this was a typical fantasy setting. The elves had long ago been the dominant race, but the short-lived but fast-breeding and innovative humans had pushed them out of the way. Dwarves lived in the mountains, didn't like anyone, but traded anyway. There were sometimes monsters. Magic was for elf-lords and old guys who studied hard. The gods sometimes gave power to change mortal existence, but not very often. Then things started to change.
Elven Blood Magic really took off with the creation of the first blood trees about 300 years ago. 150 years ago the elves had finally really gotten going and started the elven expansionist wars, or the elven reclamation wars if you ask them, using their fearsome orc troops. By then the dwarves had completely withdrawn from contact with other races, unwilling to be drawn into the growing conflict, and they haven't come out since.
For fifty years the elves continued an expansionist program, which halted 100 years ago with the elven schism, a conflict which outsiders still don't really understand. Orcish armies marched against elven targets, and the previously sedate pace of elvish blood magic creation was kicked into high gear by the need to outdo other elves. The war was however much less violent than the wars of conquest, with military might often demonstrated rather than used. After thirty years the schism was resolved and the elves again began to look outward.
It was during the schism when soma became a popular recreational drug due to new cultivation techniques. Within a decade (about eighty years ago), an enterprising priest had noticed its effects on his novices, and the prayer mill was born. A decade later, prayer mills were already widespread, and when forty years ago the elves began another expansionist push, they were met with prayer-powered magical weapons and suffered a humiliating defeat. The brief two-year Dar River War was enough to break the last barriers to acceptance of the prayer mills, so effective were their products in defending human lands.
Since then relationships between the elves and humans have been chilly but with conflict limited to an occasional border skirmish, as elven passions have turned to tending their present lands, and human desires to getting rich. Humans believe that the elves are warming to them, and that there is little chance of another elven war - those who actually fought in the Dar River War are sixty or so and are dying off. There is certainly more trade with the elves than there was a decade ago, and elven enclaves in major cities - though not, notably, in the Dar Empire.
Prayer mills have entered a mature stage of development, although the archanologies springing from relatively cheap magical power are still rapidly changing, and changing society with them.