I've been considering writing and posting (for free) stories based on a homebrew D&D setting I came up with. Most of the questions on here deal with the legality of posting rules mechanics etc, which I'm not interested in. I'm only interested in the fluff, the setting. I don't know how far the copyright around WotC's stuff extends - I know that ideas like dwarves and elves precede them, but what about something like a tiefling? Can I mention a tiefling in my story without getting sued?
The thing you need to look for here is if a name like Tiefling is under trademark, not copyright. Simple words cannot be copyrighted, nor can game mechanics (to a degree, as this is something that keeps popping up in both copyright and patent cases).
My recommendation is to be upfront that you reference the setting and creatures owned by Wizards of the Coast, as a not for profit work of art. If you really want to play it safe, you can even run it by WotC – they seem to be pretty open to wecomics and others referencing their work, and may even supply you with the necessary boilerplate disclaimer you need to protect yourself.