Actually, a 'wizard' noble who turns up if you meet certain conditions, and can perform certain useful services in return for a small chance of completely random side-effects like reanimating all the dead in the graveyard or turning all the booze into GCS venom or just setting himself on fire could be an interesting late-game challenge.
This is exactly sort of magic is the sort I don't want. A wizard noble who sets things on fire randomly is getting an unfortunate accident. I don't care what sorts of supposedly useful things he can do, he's getting an unfortunate accident.
DF is about mitigating your risks and planning ahead for all possible disasters, and a wizard that does things like that is a walking disaster factory. There's just about nothing I need to do that I can't do with mundane means, so why invite disaster for no reason?
If there isn't some way I can control the risks, it's not welcome. If I get a magic artifact, and I can't tell what it does or find some way to test out exactly what it does without risking my whole fort, it's getting atom smashed. To do anything else is idiocy tarted up as fun.
It's not "Losing is Fun", it's "Learning is Fun". If you mess with water, and find out something you didn't know before about water pressure, then you have a surprise you didn't expect, but can learn from that, and enjoy the game because of it. If your fortress crumbles because your military can't be bothered to learn how to use their stupid crossbows, and there's nothing you can do but wait for Toady to fix the bug, it's just frustrating. Losing because of something you screwed up on and learning how not to repeat that mistake again is fun. Repeatedly losing because the game just rolls a critfail for you, with there being nothing you can do about it, is a reason to find a new game to play.
When I started up the
xenosynthesis thread, I was trying to strike a balance on this sort of issue. Sure, disasterous things can happen, but if you pay attention, it's something you can see coming, and take steps to mitigate. Much like with the bluemetal, there might be benefits for letting your environment get more magical, like having more magical creatures you can strip apart for resources, but if it gets too magical, the whole system starts to potentially collapse on you for getting too greedy.
It's also something that lets different players choose how much risk they want to expose themselves to. It doesn't force one player to have to put up with the randomness that a different player would want. You want the rewards, you have to take the risks with it. You don't want the risks, that's fine, but you don't get the rewards.
Plus it means the dwarves themselves aren't magic, they just try to play with things that are magical even if they can only vaguely understand how they work.