As for the first two, it obviously depends on what your concept of the game should be like. I do not punish my players for building effective characters, but I do try to dissuade them from bending (and abusing) the rules. I'm very comfortable with modifying the RAW if I feel they are being used to break either the balance or theme of the game. I'm less eager to toss them out, but I will if necessary.
And how is spending 500 xp to be able to see magic breaking the balance of the game? Okay, so he's got a bit of warning vs. traps, invisible critters, magically disguised opponents, and ... that's about it. That is, if all your traps are magical because you ignore the mundane traps ... and if the invisible critters stay put for two or three rounds while the Wizard concentrates ... and if the only uses for Illusion are to disguise yourself ... and if nobody picks up ant-divination effects such as, oh, Magic Aura, Nondetection, and potentially Mind Blank.
As Detect Magic is a cantrip, wands of it are dirt cheap. As you can concentrate (a standard action) and move in the same round, a mage could potentially go through most of a dungeon at a walking pace just using a simple wand of Detect Magic (which a Wizard can make in eight hours for 187 gp, 5 sp, and 15 xp, assuming the Wizard took the feat for it).
By the time you can Permanancy Detect Magic (caster level 9), Arcane Sight is available (a 3rd level spell) - and has a nice duration, better range, no delay, and no need to concentrate.
Additionally, a Permanent Detect Magic doesn't really put anyone out - it doesn't heal like the Cleric, it doesn't kill things like the Fighter, and it will only find a small subset of the traps that the rogue will ... and it does absolutely nothing about disabling the trap, in any event; just finding it.
How in the world is this disruptive to the game?
I don't think this is metagaming, not by the definition anyway, but I do think it's powergaming (using the RAW to give your character the maximum advantage in combat or solving puzzles without consideration as to role-playing opportunities).
Yes, because a Wizard, who's fluff is all about seeking out magic, isn't going to arrange to use basic tools for finding ... magic. How is this without consideration as to role-playing opportunities? Do you prevent Barbarians from using Greatswords, forcing them to stick with Greataxes or Greatclubs because they fit your definition of the class's flavor better? Do you prevent clerics from casting Cure spells because that negates the need for natural healing?
Others call this building an effective character. (Interesting how PC words infiltrate even into gaming.) There is nothing intrinsicly wrong with that, but some people don't like it. I'm one of them and it sounds like the OP is another. Like I said, I don't believe in wantonly punishing players for this or just randomly tossing out a rule because a player did something creative that makes me think harder (that's a GOOD thing, not a bad thing). But I also think when a player starts twisting the RAW to game the system rather than play the game, the DM is entitled to start using the the player's own tricks against him in creative (and fun) ways. You got detect magic on permenantly? Great... You just got dazzled when you went into the wizard's tower.
How is this example "fun" for any of the players? How is what amounts to arbitrarily applying a penalty to the player not "wantonly punishing" them or "randomly tossing out a rule"? By default, there's nothing in Detect Magic that Dazzles someone when exposed to a lot of magic (although there is a penalty for the Detect [Alignment] spells if you're directly opposed to the alignment you're detecting, and it's very much stronger than you are). Are you springing this house-rule on your player with no warning, or letting him know in advance these little things that an expert on magic like a Wizard would know, and would affect his actions and preparations?
Similarly, what constitutes "cheesy" is in the eye of the beholder. I think it's cheesy b/c it takes a lot of the fun and surprise out of exploring a dungeon. As a cast in point, there is a dragonfire adept in my group who can cast Detect Magic at will and, effectively, Identify Item as well. As a consequence, there is no surprise or mystery when they find new magic items -- no experimenting with their functions.
At what point do you punish someone for being careful? In a world where cursed items exist, you DON'T just randomly try to activate every little thing you run across ... at least, not if you want to live long. You need to identify a wand before using it - otherwise, you might end up using Cure Light Wounds on that Demon you're trying to kill, or Fireball on that buddy you're trying to heal. Do your players have "fun" with what amounts to arbitrary character deaths?
Seriously, requiring your players to experiment with items to identify them does nothing more than require everyone at your table to know magic items backwards and forwards - anyone at the table who doesn't have such knowledge can't use magic items effectively, beyond the dull ones that give simple +'s to things like attack, AC, and ability scores. The interesting ones that need activation? They're completely beyond the reach of someone who's not familiar with how to go about experimenting with magical items in reasonable safety. How's that fun for that person when everyone else at the table gets to use their items cool powers? For that matter, how in the world do you let the player know the item even needs experimenting if you're not letting them use such things as Detect Magic to find out it's magical in the first place?
That takes away part of the experience to me. JMO. Other people who see this more of a game of dice, rules and an interplay of cause and effect rather than story-telling and adventure don't think it's cheesy. Perfectly valid opinion as well. There's room for disagreement.
The catch for this sort of thing is that you need to know
your players' preferences and abilities, more than your own in such regards. If
your players are setting themselves up so they can easily detect and locate magic, chances are, it's because their preferences align with that playstyle. In other words, as long as they aren't stepping on the toes of anyone else in the party, why exactly are you trying to nix them?
Despite the disagreement, I actually think a lot of your suggestions about the traps were inspired and a way for a creative DM to deal with this in the context of a dungeon crawl.
Thanks.