Why would a smelter *consume* magma? It would, at the most, cool it down.
It is a resource, it is thereby consumed. That "consuming" it turns it into worthless cool rock [it would, notably, _not_ be obsidian - really, the magma pipe lining itself should also not be obsidian, it should be e.g. granite] rather than removing its mass is just a detail.
Speaking ideally, all smelting operations should require some level of fuel, even with a magma smelter. You need some carbon to do that kind of thing no matter what you use as a heat source, provided you aren't simply extracting native metal from rock or making alloys.
You also always need flux. And it's NOT always the same ones as it is for iron/steel.
Really, what we need is finer-tuned fuel/reducing agents/flux, and have the requirements of the latter two be relatively small (since they're being consumed for the reaction rather than generating heat) and the former be dozens of units, and one unit coal or wood generates a large number of bars of coke/charcoal, and one piece of flux stone is kept track of in the smelter as a large number of "flux units".
Also, different reactions require different flux - limestone is used for iron and steel, but
http://www.cyphertext.net/~gfish/smelting.html indicates the use of iron oxide or silica - depending on the ore - as flux for smelting copper. (I wonder if the resulting slag from the use of iron oxide could be smelted for iron)
It would need to always be possible to import flux (a tendency for civs with no access and no trade for flux to die out would be sufficient. A way to check material availability before selecting a civ would be nice too - you can start a custom embark and then abort, but that's more tedious, and you may also want to know what's available from your human neighbors or what kind of metal the goblins will be using)