It's a midget dressed up like a gnome. Looks like about the size of the guy who played Mini-Me in Austin Powers. Real gnomes live in Switzerland and rarely come out of their underground vaults.
This is the creepiest shit ever <object width="425" height="355"><param name="movie" value="http://www.youtube.com/v/mzT667yg1pw&hl=en"></param><param name="wmode" value="transparent"></param><embed src="http://www.youtube.com/v/mzT667yg1pw&hl=en" type="application/x-shockwave-flash" wmode="transparent" width="425" height="355"></embed></object>