Here is an odd way to look at it.
To better see where the MT fits, maybe we should look at redefining our perspective of the Wizard and Cleric classes.
In the new core system, we will have this:
Wizard = Arcane Specialist
Cleric = Divine Specialist
Mystic Theurge = Generalist
Change of perspective:
What if the MT was considered to be the standard way to go, and the Wizard and the Cleric where mearly specializations of either the Arcane or Divine aspect? If the MT was a standard class, how would you react if the Wizard was just introduced as a new class and you where told that there was a way to cast far more higher level spells, at a faster rate of advancement, for the cost of some of your lower level spells that you seem to have so many of?
As I said before, I don't see the MT as overpowered. In my opinion, the difference of a few spell levels is significant.
Four 9th level spells vs 1?
As I said before, my player is considering this class at 7th level. Now if he takes it, he will only be able to cast 2nd level spells where he would normally get 4th level spells. For this reason alone I suspect he will not take it.
He will effectivly be trading his higher, most usefull spells, for a huge number of lower level spells. He can still only cast 1 spell per round. I suspect he will soon realize that he has an overabundance of lower level spells that he simply doesn't need each day.
After all, would you rather cast two flaming spheres and a Cure Mod Wounds in three rounds, or a single Phantasmal Killer, Wall of Fire, or Polymorph in one round? Or maybe even all three in three rounds? Three levels is alot.
The point is, the Wizard has enough spells per day to get by in all but the most prolonged situations. Are the extra spells really worth the potant spells you would be giving up?
I think the MT is balanced.