Welcome to Gaia! ::

or this world is different from a normal world and all magic is born from the same place, it is our own campaign world so anything goes

plus who says there are dieties? or a "weave?" is not greyhawk anymore :3

There are flaws in the fact of "magic running dry"
here are some:
Magic in most cases is limitless but that limitless power comes with a price (how high that price is depends on how high the spell level is) plus it takes time and training to even be able to use it, one is usually not born with the ability and access to use magic in all its forms. There is also the fact that the reason magic is limitless is the power source for magic is usually the soul or some higher power. low level spells cost such an insignificant amount of experience that it is regained soon and not needed to be recorded. Higher level spells that drain lots of experience is comparable to taking a part of the soul that is large and exchanging it for some impossible feat like a Wish or crafting a powerful magic item. (In this case the DM can simply overrule the normal source of magic and whether it is limitless or not but that's no fun, coming up with an explanation as to why it happened is funner.)
For Example: This magical backlash could have occurred because the world itself could not hold that much active magical energy and it simply stopped maintaining it causing an explosion (this is a flawed idea but the best I could come up with.) That explosion could have then banished all the deities simultaneously and destroyed a great many of the people's souls who had a connection with said magic. Deities of magic could therefore not repair the broken magic because as described in Deities and Demigods (I could be wrong on what book but I know it came from a book.) deities who have been banished cannot enter or interfere with the realm they've been banished from for 1,000 years. Also since so many people had died from the explosion of magic the knowledge and techniques used to access such powerful forces effortlessly would be lost. Though in my opinion the sheer chaos of a magical backlash wave would cause an epidemic of a magical disease called Warp Touched from the Book of Vile Darkness (again I've read many books so I might have mixed up the book name with the wrong book.) Also "the Magi" knowing that the over use of magic would cause a catastrophe would have probably cut themselves off from the arcane powers around them to preserve themselves.

Wellll, considering this guild is kinda dead. :/

No, you cannot join this ******** game, okay? This guild has been dead for months. Stop posting here, you pathetic c**t.