I had cause to think about the languages for my world. There’s a school of thought that says, when it comes to Dungeon Fantasy, it’s best to sweep all that complication under the rug, and just have everybody speak English, with the occasional accent. On the other hand, I rather like the mini-quest to decipher the unreadable text. It worked for Tolkien, right? Anyway, the players seemed to have assumed multiple languages from the beginning, so might as well go with the flow.
The world of Tembladera has many languages, of course, but there are only a few that are of interest to the local delvers. (I don’t want to get into a situation where somebody puts 6 points into Titan and Ogre, only to be unable to communicate with a stone giant. “Old School” is one thing, but one can go overboard.)
Everybody in town speaks the Common tongue. It’s the language of humans and halflings, brought over from the Old World. If you don’t speak Common, you’ll have a hard time trading in town – or even making it inside.
The elves and dwarves each had their own languages before their empires fell. The ones you meet in town speak Common, and often don’t know more than a few words of their ancestral tongues. The dwarves used dozens of languages, but the one that was used in the mountains around Tembladera, we know as Dwarvish. Likewise, the elves had dozens of languages, but one was dominant for miles around, and we call it Elvish. The different sylvan races – dryads and such like – also speak Elvish.
Goblin-kin of all kinds speak Goblinistani — a name which I saw on Dungeon Fantastic and immediately started using. This is also the language spoken by mammalian humanoids, like trolls and ogres. Really, it’s more of a pidgin trade tongue, put together from hundreds of dialects, but for dungeon purposes, it works.
Lizard men speak their own language, which will be used by any other reptilian races that come along. (I’m ruling out dragon-blooded, right out of the gate.) If any coleopterans show up, they’ll be speaking their own language, too, but I think beetle-people might be too weird, even for my group.
Elder Things and assorted abominations speak the Dark Tongue. I’m not sure that learning it would be an advantage.