... for Toady to make it balanced.
You can say a lot of good things about dwarf fortress, but it is not balanced.
I imagine that the final goal of a fantasy world simulation is a possibility to create various worlds - both those balanced ones and chaotic ones. Though for a longer play I'd prefer the first one, both can be fun.
I think the chaotic one will be more fun though.
I beg to disagree
And that's why it would be good for this to be a setting, be it a switch or a slide of some sort, to be set by the player upon world creation. Both camps can create the type of world they prefer, i.e. one with the type of magic strength/rarity/etc. that they prefer.
I was very interested in
Miuramir's post, and I can say that to a large extent it is true that living systems have a tendency to self-correct in the way described; however, although non-trivial equilibria are more common than you might expect if you knew nothing about such things, or if you are using differential equations to simulate things in absence of space considerations, it is still possible for things to die out, and this can indeed happen in ways that some might consider undesirable. In a world where magic is very very strong, and very very rare, I would imagine it would quite well be possible for the race that happens to have magic first or most frequently to wipe out other humanoid races, for example. In that sense, some balancing might yet be required, or at least, some consideration to the ranges of values that are available to be set upon world construction so as to have at least the possibility of having a fairly balanced world with non-trivial equilibria.
That said, I wouldn't worry too much about this ahead of time; the systems will be coded, and testing will be done, and mistakes will likely be uncovered and corrected either quantitatively (changing some parameters) or qualitatively (adding or removing (sub-)systems to allow things to interact in different ways). I expect things to be very interesting and very playable, if not in first instance, then certainly soon after. I for one am greatly looking forward to what the game will look like after the addition of magic systems.