Simple! use scrolls! its called Geomancy ladies and gentlemen. The use of symbols to cast spells.
First you need paper and a bookcase.
Right click the bookcase to open a special crafting menu for scrolls. It would open up kind of like a furanace. with three slots and a finished product slot. this in additon to a fuel slot.
+ (  +  ) = 
 = fuel =
First you place paper into the left slot. then place a gold bar into the fuel. it takes a whole gold bar per scroll.
Then the paper opens up and you can type a single letter. Press enter and it starts crafting a spell scroll.
Depending on what you typed in you can get a diferent spell. Example; (A) summon pig spell, (G) create Block of Dirt, (L) Detect Living spell (highlights mobs), (P) Summon Pig, (F) Create a block of fire.
To make more complex spells, put 2 spell scrolls into the Combining area (  +  ). To enchant items, put an item and an approprate spell into the combining area. Example; (GG) Create Hill spell, (FP) Flaming Pig missile
To use your spell scroll, simply put it into your tool bar and right click.
I dont think spells should be stackable. depending on the scroll
Personally, I was thinking magic/alchemy would have to be done on a new 5x5 crafting table made with obsidian or somesuch, but that might be too predictable. Definitely wanting to keep the availability of magic down to players who've had some time to explore and do stuff.
Seems a bit easy to make the scrolls, with just a bookshelf and a piece of paper, maybe redstone ink, a whole book, and you don't get any effects until you combine them. Another solution is you get a random arcane symbol each time, and you have to keep going till you get the two right ones for your purposes
Notch has said when he adds magic to the game,it isn't going to be like cast spells (fireball, etc.). It will be structures, like shrines, that will add an enchantment to an area. Although your idea is interesting if each scroll requires some unique material to make, and has limited use.