I would probably prefer 1, but 3 might be interesting. Frankly it depends more on how the gameplay of three works- you gave us the setting, but what will we be doing?
Pre-planned ER-type missions with five-ten-twenty players?
Players split into the gangs fighting over areas, possibly with a strategy element?
Just a free-roam type thing like we have now, just with a different setting?
Ect. All of those are very different, despite being in the same setting and with the same mechanics.
And how will sciencing work in 3? Will the gangs all know the words already, or will you still have to figure them out? Could you share with npc gang members, making your gang stronger thanks to learning the antimagic word or something?
Would 3 change Zentol back into "Lovecraftian dimension rip"?
Basically it would be like this:
Magic is a limited resource. Having it makes you extremely dangerous, even if you don't use it, because simply having it in your body increases your stats.
The society this takes place in is basically in rapid decline because it used magic for everything and now there's little left. Kinda Mad Max, but with wizards.
Out of this spawn several groups of the magically inclined who are trying to empower themselves and control the city.
The groups are fairly diverse and are broken up by how they get magic and by how they use it. The starved magi are gluttons who stuff themselves in order to convert their own fat and flesh into magic and some aren't above cannibalism. Bloodskimmers suck magic from living things, using sacrifices to empower themselves. Expect them to be carrying bags of rodents as ammunition, of sorts. Or the Artificers, remnants of the magical engineers guild, who build arcane machines and weaponry to battle their foes. Or then there's the outer group, what amounts to the police, the Mage Breakers, who have no magical abilities but counter with government issued anti-magic gear.
The actual map would be broken up into a few dozen sectors or areas, each with an important landmark or 3 to hold. Each sector would give the controlling party access to certain things and the territories could be fought over, won and lost.
Combine this with a system of exploring beyond the city to gather magical artifacts, researching, and slowly mastering magics. A much more strategic, open worldy, scorched earth campaign sorta deal.
Does that make any sense?
Also, I'll throw up the current turn on thursday, since today was pretty damn busy, tomorrow I'm driving cross country and the day after that is my birthday.