Not even close. By making the claim "magic makes sense here", they've painted themselves into an even bigger corner than your quibbles about magic item profligation. If you stop and explore the implications of magic on a world to the very end of their tether, you will soon wish you hadn't, because the result will be alien to the extreme.
Your players are very, very selective in what they pick out as nitpicks. The effect of a mere
fly or
invisibility spell, or the fact that trolls and giants are wandering the wilderness quickly turn a scientific, logical approach to D&D's implications into Bizarro World.
There was a reason for everything to work the way it did.
I'm sorry, but IMO this is complete bollocks. Eberron makes a token concession or two, then pretends "job done". That would have been okay, but then they go and
advertise that they've taken care of the problem. This is worse than not addressing the issue at all, because it clearly doesn't address the issue in more than a token manner, and we've taken the magic out of magic by making low level magic ubiquitous. Magic's supposed to be mysterious and magical, not a mundane, everyday part of society powering trains and flying taxis. When FR does the flying ships it makes sure they're someplace far away from where 99% of campaigns are set, increasing the sensawunda factor. Magic's common enough in D&D without using Eberron's "solution". No wonder people turn to psionics to get their "magical magic" fix.
And it didn't feel nearly as clunky as "You know those evil wizards that want to conquer everyone? Yeah, well....they now have item shops in almost every city in the world. People forgave them and they moved in last week. You didn't notice? Sorry."
If it's a choice between a retcon on a setting with it's heart in the right place and a setting heart based on design ideology soapboxes, marketing checklists, incoherent genre combinations and "attitude", I'll take the former. FR comes across as Itchy & Scratchy to Eberron's Poochy.
Besides, they aren't staring at the paint and making up a story around that. They are instead saying "What's the most interesting ideas we can come up with to make D&D easier to play in and more fun to play in?
If you're talking crunch uber alles, then yes, that's arguably correct, and a path that has to be gone down to a degree to make the game playable. It's probably best not to extend that philosophy too far into setting territory, though.
Alright, now that we know the answer to that, what changes do we need to make to FR to make sure that all of these things are true in that world?" And they are trying to do it without pulling a Highlander 2: "Of course the immortals were ALWAYS aliens."
A retcon is easily handwaved; a can of worms opened at the heart of the setting's design philosophy less so.