I'm not convinced magical magic is impossible to have, but I strongly suspect magical balanced magic is.
I'm not sure that I agree with this.
I think that the way to balance magical vs. non-magical classes is to give both sides abilities that the other side does not have.
For example, the Martial power source (which I think should be called the Physical power source) should be an internal physical source of power of the PC. It should allow the PC to swim and climb and hide and use weapons better than the normal Melee Basic attack, Stealth, Athletics, and Endurance of other classes in other power sources.
Arcane casters might use a once per encounter spell to enhance their jumping capability, but Physical PCs should be able to enhance their jumping capability every time they try to jump.
On the other hand, Arcane casters can fly. Flying is typically better than jumping, so the jumping enhancements of the Physical PCs should occur at a much lower level than the flying capabilities of the Arcane casters. That's how balance should be maintained.
Casters of the Divine power source don't necessary get any sort of improved movement spells or powers, at least until much higher level. That's not their schtick. Primal casters, on the other hand, should gain a lot of different natural effects (flying like birds, swimming like fish, shapechanging into other species).
If the power sources were segregated a lot more on which effects each could produce, at what levels they could be produced, and the potency of those effects, I think that the game would feel more magical again. Each power source and even each class, would feel more unique. There's always going to be some overlap, but segregation should be designed into the game system from the start.
I also personally think that the Martial and Arcane power sources shouldn't be able to heal (or at least not until much higher level and then, at a much lesser degree). These power sources should hand out temporary hit points for their Leader type classes, but healing should be reserved for the Divine and Primal power sources where healing is special and unique again and granted by outside non-Arcane supernatural or mystical forces.
Segregation of healing abilities makes the Divine and Primal classes feel special and magical again. Not every power source can heal, just like not every power source can Teleport, just like not every power source can Fly, just like not every power source can Dominate foes or Stun foes or Enrage foes.
Another thing to remember is what resources are spent on. In 4E, the Fighter is for free typically walking around in Scale and Plate at AC 19 while the Wizard is typically walking around in Cloth at AC 14 at level one. The Fighter doesn't have to really spend a single resource on AC, but the Wizard often spends a feat on Unarmored Agility or Leather Proficiency and often uses up his second level utility spell with Shield. Just so that the Wizard is 3 lower AC instead of 5 lower AC for most attacks, and for a few attacks per encounter when he really needs to be, 1 higher AC than the Fighter.
The reason I picked AC as my benchmark here is because about half of all attacks are against AC. Individual NAD defenses are important, but not as important as AC.
The Wizard is walking around with a fairly crappy AC and much lower hit points all of the time. In return, his powers should be more potent than the Fighter's powers. The Fighter shouldn't have the same potency for same level Close Burst powers that the Wizard has.
In this case, balance is about the fact that the Wizard either cannot survive as long as the Fighter, or the Wizard has to spend more resources on defense and hence won't have as many offensive resources as the Fighter (and still won't actually get as close as the Fighter on survivability). One could argue that the Fighter gets attacked more often, so he needs to have a higher level of survival, but that isn't guaranteed. That's a tactical choice of the players (and often a conscious or subconscious choice of the DM). I think it is perfectly reasonable in many scenarios for the Wizard to be up in front on occasion and take his fair share of attacks, but if he decides to do so, he will often be setting aside defensive resources to allow this. Quid Pro Quo. Balance.
