The presence of gnomes in waldorf education explained in a rather magnificent manner by a Steiner school in the UK:
Gnomes are the embodiment of the life of the earth as a mineral entity. Thus they are associated with rocks and mountains, deep mines and caves, their quick-witted intelligence encompassing the whole earth. The gnomes are important because they encourage us, or simply help to keep alive the possibility that the mineral earth still holds within it the faintest glimmer of life. Without the help of the gnomes, we might be inclined to let go of such a thought entirely. … Because of this, gnomes have a significant role to play in children’s education. … However, though gnomes may be represented and spoken of a real within the school, whether parents or children believe gnomes are real, or symbolic of something else, or how they are spoken of in the home, is up to them.
(I think, in the last sentence, it’s supposed to say ‘spoken of as real’.)
Ht The Quackometer.