It seems to me that there are several factors that make a good Favored Enemy: Rarity, Level Spread, Difficulty, and the Inclusion of weak enemies (fodder), tough enemies, and bosses. Undead is a perfect example that scores high on all of these marks. Undead are very common, with many quests dedicated solely to them. Undead are found throughout all levels of gameplay (Slightly sparse in the way late game, past Necro4), Undead are tough enough, with their various immunities and special powers, to warrant needing to kill them quickly, and undead include complete fodder, some tougher middlemen, and bosses ranging from easy bosses to raid bosses. My example proposal for new Favored Enemy classifications will attempt to fulfill all these criteria and make some new contenders for top Favored Enemy picks.
Abberation - As is, plus Ooze and Plant. Ooze and Plant help fill out the fodder role, as well as extending the level spread and increased rarity of Abberation.
Beast - Include Animals, Magical Beasts, and Vermin. Extremely common enemies found at all levels, but lacking many notable bosses or difficulty factor. This category still needs work to be a useful contender.
Construct - As is, constructs are not quite as common as other groups, but the extra toughness factor helps them stand out as a top pick.
Elemental - As is, plus Mephits. Found at all levels, Common and Tough, but lacking notable bosses (plenty of easy bosses). Also lacking fodder, which the addition of Mephits should help with.
Giant - As is, Giants fulfill all criteria nicely, and are already a top pick.
Humanoid - Humans, Elves, Dwarves, Halflings, Gnomes. Very common enemies found at all levels, but not very tough, and very few notable bosses. Still a bit underbalanced, but inclusion of Drow and Duergar should help.
Humanoid, Monsterous - As is, but include Orcs, Goblinoids, and Gnolls. Mostly fodder, with a few tough enemies. Found at all levels, though it thins higher up. A few notable bosses (medusa, mostly) but light in that area.
Outsider, Evil - As is, plus Tieflings. Tieflings help round out it's low level content, making this group uncommon at low levels, very common at high levels, tough, and having a multitude of bosses and raid bosses.
Outsider, Other - Tieflings, Mephits, Djinni, Tharaak Hounds, Eladrin, anything and everything not covered by either the original elemental or evil outsider. Good level spread, very common, but lacking in tougher enemies and bosses. Also, terrible name (Could be "Extraplanars" or something instead)
Reptilian - Kobolds, Trogs, Medusa and Dragons. Covers low and high levels, with a bit of a gap in the middle. Covers fodder and bosses, with a gap for tough enemies. Not terribly common. This category also needs some help, as it is still not a real contender. This category could possibly be broken up and divided into different groups (Kobold/Trog/Medusa into Monsterous Humanoid, Dragon into Giant or Abberation).
Undead - As is. As stated earlier, this group sets the standard for others.