I was playing Diablo III last night after playing WoW, because I hate it when days happen and I see the sun, when it occurred to me that the two settings are very different in a variety of ways, and one of the big ones is this - you could (and have) basically fit the entire thematic kit of the Diablo setting inside WoW, but you couldn't do the same in reverse. There's not enough room, for lack of a better word, for all of Warcraft inside Sanctuary. What do I mean by that? Well, Diablo as a setting has specific themes - the war between Heaven and Hell, Sanctuary created by dissidents from both sides, the creation of humanity by said defectors, and Diablo's plans to enlist or subvert humans to fight in said war between these polar opposites.
Warcraft has a host of demons that seek to destroy all reality that can easily stand-in for the hosts of Hell from Diablo, and the risen dead we see in places like Tristram is if anything small potatoes compared to the plague of undeath we see in the Plaguelands. But WoW contains multitudes that have little to nothing to do with them - the Old Gods are a completely different kind of menace and one that there's no place for in Diablo. Similarly, the many races of the Warcraft setting have no place in the cosmology of the Diablo setting.
Part of the reason for this is the origin of each game - while both have Dungeons and Dragons in their DNA, Diablo has always been a more straightforward dungeon crawl while Warcraft was originally an RTS with deep roots in the orc vs. human gameplay element. As an RTS, and one with two competing factions, new units helped create diversity and gameplay, and as a result having these new units be of different races gave flavor to the setting. Diablo has always been about you, alone in a vast dunegon complex or infested region, destroying waves of foes by yourself or with a small group - the variety came in terms of different kinds of foes to destroy and the ways you did so.