Spellfire Rulings
Here are the rules as written by Wizards of the Coast.
Forgotten Realms: Campaign Setting
SpellFire
A spellfire wielder can ready an action to absorb spells targeted at her as if she were a rod of absorption. She gets one level of spellfire energy for every spell level absorbed and can store a number of spellfire energy levels equal to her Constitution score.
As a standard action, she may expend these spellfire energy levels as a ranged touch attack (maximum range 400 feet), dealing 1d6 points of spellfire damage per level expended (reflex half DC 20). Spellfire damage is half fire damage and half raw magic power, just like the damage of a Flame Strike spell is half fire and half divine energy. Creatures with Immunity, resistance, or protection against fire apply these effects to half the damage.
A spellfire wielder can also heal a target by touch, restoring 2 hit points per spellfire energy level expended for this purpose.
Unlike most supernatural abilities, spellfire is affected by spells and magic items that affect spell-like abilities, such as a rod of absorption or a rod of negation (if pointed at the manifestation rather than the wielder). It can be thwarted or counterspelled by Dispel Magic, and theoretically a spellfire wielder could counterspell another's spellfire. However, spellfire is a supernatural ability and does not provoke an attack of opportunity when used, nor is it subject to spell resistance.
Magic of Faerun (New Information only)
If her Constitution decreases so that her number of stored spellfire levels is greater than her current Constitution, the excess levels discharge at a random creature in range as destructive spellfire.
Stored spellfire energy levels are unavailable in an Antimagic Field, but are not lost. Once the wielder is out of the Antimagic Field, the spellfire energy levels are again available for use. Dispel Magic and similar effects cannot negate stored spellfire energy levels. A character with stored levels radiates magic as if he were an item with a caster level equal to his number of stored levels.
From the above information, we find out the basis behind spellfire. A character must ready an action to absorb spells, thus taking his turn in combat, and the spell must be targeted at him. A character with stored spellfire points can release them to deal damage to a single target. The damage is equal to 1d6 per spellfire level expended (with a maximum being your Constitution score), on a successful Ranged Touch Attack, not to mention the target gets a save for half. A character with store spellfire points can heal a target by touch, healing 2 points per spellfire point expended.
Looking at the ruling, I cannot see how Spellfire is a broken rule. I have friends that refuse to allow it in their games, and I laugh and say "have at" when people ask for it in my games. First off, you have to ready an action, and hope your targeted with a spell. If your doing this in combat, your opening yourself up to radius spells, as well as attacks from other enemies. Think of it this way. Wizard1 has spellfire, and is in combat against wizard2. Initiative is rolled, and wizard2 wins by 2 points, due to Improved Initiative. Wizard2 cast's Hold Person on wizard1. Wizard1 passes his save and is uneffected. Wizard1 takes the turn gathering his thoughts, and gets to go at the highest initiative on the next round. He then readies an action to absorb a spell. Wizard2 cast's fireball, dealing 6d6 damage (rolling 19). Wizard1 feels is in pain.
Scenario Two. Wizard1 wins initiative and readies an action to absorb a spell. Wizard2 casts Dominate Monster at wizard1, but the spell is absorbed. Fighter1 charges out from behind cover, and bull rushes wizard1, knocking him to the ground. Round Two. Wizard1 attempts to stand, then takes a 5 foot step away from fighter1. Wizard2 cast's Disintegrate, dealing 6d6 after wizard1's lucky save. Fighter1 then takes his 4 normal attacks, and his 1 extra attack from having speed on his weapon. Wizard1 dies.
Its rare to find a good use for absorbing spells in combat. If you were in a 1v1 wizard duel, you might get to absorb a single spell before the enemy found out what you were, and started using radius spells.
Of course, if you have spellcasting friends that you can trust, and you find a safe place to do it, an ally can "fill you up" so that your next combat is a little easier. You could unleash a 12d6 blast against the next Big Bad Evil Guy that you meet, or you could heal the groups cleric enough to bring him out of unconsciousness. In both of these forms, spellfire can be useful.
After all of my ranting of how Spellfire isnt unbalancing or broken, I now change over to the broken part of spellfire.
A metagaming player
(one that looks for loopholes in the rules. You know him as the guy that goes into the DMG and makes a magic item that follows these rules. Constant Effect, worn item = (Spell Level x Caster Level) x 2,000 (x8 for casting time of spell) and uses a worn item with the spell True Strike. 1x1x16,000gp. So for 16,000gp, the item grants you +20 to hit constantly. Metagamers suck...) will attempt to do the following to make Spellfire as useful as possible.
Character = Wizard. Wizard has Familiar. Wizard cast's Shocking Grasp then readies an action to absorb a spell. Then wizard has familiar hit him with spell. Thus, granting him 1 Spellfire level.
Allowing this to work would be up to the Dungeon Master of course. Metagamers that arent allowed to do this will often complain, simply because they came up with something that should technically work.
I would be willing to grant Spellfire to a non casting class if they were willing to take an EL of +2. That might even out the fighter taking Spellfire Wielder and Weapon Focus: Spellfire at first level.
I have to laugh. There is no reason to add a level adjustment to Spellfire. Get a friend or two to create characters normally. Then tell one they can have spellfire. Make sure they know that if organizations (evil ones usually) find out they have it, they will be hunted. (Spellfire was intended to be a Role Playing Mechanic, that granted a little extra help) Write up a few short adventures, and run them through just as you would a normal game. Every time they absorb a spell or release stored energy, write it down. Mark who cast the absorbed spell, what spell it was, what else was in combat, and how much damage the player took from other creatures the round he absorbed the spell.
After a few adventures, you will see that spellfire, even if metagamed as mentioned above, is not really game breaking. Also, watch how long it takes for the character with spellfire to actually use the ability, and how long it takes the other character to find out about it. I held a game with two players, and the one without spellfire didnt know about his friends "abilities" till the 5th session. Of course, session 8 was entertaining because he was spotted using it, and was attacked by cultists.
If you want game breaking, take the wizard that never runs out of spells (Complete Mage: Reserve Feats, Or Complete Arcane: Warlock)
Looking at the rulings from the book, Spellfire isnt that powerful. If you havnt allowed it into a game simply because you think its too powerful, I urge you to make a mini game and playtest it. I have an ongoing campaign with a character with spellfire. It comes in handy once in a while, when the cleric falls, or when they come across something that just wont die (that half raw magic damage is nice if he has points saved).
I'd think an ECL of +2 is kinda low for virtual immunity to magic. I'd put it at +3 or +4, depending on how you believe the lessened hit points, feats, and skill points will affect the character.
Ok, this one is just funny. Virtual Immunity to Magic? Did you even read what spellfire is? Or, did you just guess? I dont mean to sound rude. I just think you should re-read spellfire. Or, you can read above, as I posted the information.
I hope this has been helpful to any lookin to use Spellfire. I am not trying to offend anyone. I appologise now if I bashed anyone, or sounded rude. Im just here to point out the rulings, and give a little insight to the feat.