You are in the Church of the Goddess of Reliqua, whose domains are sleep, coma, and death.
Lore request on arcane magic.
Arcane magic is any magic beyond the domain of gods. (As opposed to divine magic, which is granted by gods.)
Some arcane magic is rumored, however, be under the control of demons.
You firmly believe there is no one out there nowadays who can wield magic, whether divine or arcane.
((As far as I know, a potion would count as magical healing, which is something that this game world apparently doesn't have. So I propose we all wait for the GM to tell us how much knowledge of magic our characters actually have before this gets out of hand.))
There are alchemical brews, created by the few alchemists, which use non-magical ingredients, and have a variety of weak effects.
(ex: aiding the natural process of healing)
Then, there were the rumored "potions," which no longer exist, which were magical and could have very powerful effects.
(ex: instantly healing fatal wounds)
Alchemical brews may have undesirable side-effects, but true potions did not.
You may be able to find an alchemist in this town, but there services tend to be pricey.
As for magic, unless you are Anders's character, all you know is that magic was something powerful what wizards did with almost no effort (ex: death rays, instant healing, teleportation), and was synonymous with "arcane" or "arcana."
Certain holy men are said to perform "miracle" even nowadays, but calling it "magic" would be an insult.