Don't laugh, I once had a PC beaten to pulp by Snotlings.
One of the strengths of WFRP is that, although it is certainly grim and gritty, it's not so portentous and dark-for-dark's-sake that it doesn't have a sense of humour. There's a reason that Ken Hite quote compares it to Pratchett.
I haven't felt the need; I wouldn't call the chances of Insanity Points and The Wrath of the Gods no risk at all. Limiting the spell in the same way that the Heal Skill is limited, however, would certainly work.
I like letting the players keep track of how many Fate Points they've got as it stops them from being boringly cautious. People still play it a bit safe because they don't want to lose those shiny, precious Fate Points, but having that slight safety net frees them to take risks and indulge in...
That's Ken Hite you're quoting, and it's very true.
That's me you're quoting, and it's just as true. Since I was about to post that anyway, I forgive you.
Sounds like you played first edition. Second edition has made Elves much more balanced and added maneuvers and other options to combat. It can be a depressing setting, but it's balanced by black humour and spots of utter silliness--one of the strengths of WFRP is that it handles more than one...