If your players are mechanic-heavy, and it sounds as though they are, a mechanical penalty may be the most appopriate. I'd say that for every re-roll they make you reduce their point-buy by 1 or 2, or rule that the most expensive starting magic item is worth 2000 gp, or your wizards only get the same known spells as a sorceror of their level or... The options are as endless as the game!