Shadows of Esteren is my new favorite low magic, low fantasy system.
http://www.kickstarter.com/projects/1176616619/shadows-of-esteren-a-medieval-horror-rpg-prologue
http://www.studio2publishing.com/shop/index.php?cPath=205
If you want a setting where magic and monsters are very rare and feared, that's precisely what Shadows of Esteren is about. It has a heavily Gothic atmosphere, so while people constantly live in fear of monsters lurking in the shadows, very few actually encounter any, and they are horrifying to behold. There is druidic and divine magic, but only very few have access to it, and their traditions restrict when they can use it, and thus very few actually see it being used.
My favorite part of the system is the Sanity system, which is very detailed (at character creation, you pick your PC's latent psychological disorder) and is meant to track your PC's descent into madness as they are faced with the horrifying secrets of the world. Going mad doesn't take your PC out of play, though, it just adds a new element to how you play him with not only consequences and risks but also bonuses.
The setting is low fantasy Medieval, but with three distinct kingdoms with unique flavor, including one that is more steampunk.
What I like most is that, while the system is designed to be grim and gritty, it's not an excessively complex system. You only need a d10, and the base rules for things like health and skill progression are complex enough to represent the danger of combat and the low fantasy, gradual zero-to-hero character progression, they aren't convoluted or punishing for players. (For example, your character can die easily and takes penalties while wounded, but you don't have to worry about losing an arm or other permanent disfigurement thanks to a critical hit).
If you want to check it out, you can buy Book 0, which has the basic rules and mechanics along with premade characters and 3 adventures that give a great overview of what kind of game Shadows of Esteren is.
http://www.studio2publishing.com/shop/product_info.php?cPath=205&products_id=3691