Magic in history

I finished Kate Elliott’s Cold Magic—a fantasy set in an alt.Europe—this morning. While I’ll save the review for my next “Movies and Books” post, it did get me thinking about the ways in which we can work fantasy into a historical setting.
Alternate history is a simple way to do it: The world is changed because of magic and vice versa. In Randall Garrett’s Lord Darcy stories, Richard the Lionhearted survived the Crusades, came home sober and more scholarly and ultimately sponsored the research that discovered the rules of magic. By the 19th century, magic is commonplace (I highly recommend Lord Darcy Investigates as a textbook example of a fantasy/mystery).
Elliott’s book fits into the same category: Hannibal of Carthage destroyed Rome so the world of the 1800s is different (airships and magic both!). I’m not sure if magic caused the change (i.e., the gods or wizards of Carthage kicked the Roman pantheon’s butts) or like Garrett’s work, resulted from it, but either way there’s no trouble reconciling history with fantasy.
Naomi Novik’s Temeraire books show why reconciliation is necessary (or ought to be). Novik fights the Napoleonic war with dragons: As a result, the sweep of the war and global politics in general is becoming very different from our own world. By contrast, Jonathan Strange and Mr. Norrell has medieval England ruled by a mage-king and magic actively intervening on the British side of the Napoeleonic Wars, yet somehow the sweep of history hasn’t changed (I love the book, but I felt that was a big flaw).
This isn’t such a big problem if magic’s presence is a little more restrained. In Lisa Goldstein’s The Alchemist’s Door, John Dee and Rabbi Judah ben Lowe can both work magic but there’s no sign magic works outside the work of such dedicated scholars. While Goldstein doesn’t spell it out, I can believe magic is rare enough not to alter established history. I tried something similar in I Think, Therefore I Die, where magic is esoteric, accessible only through study, and repressed by the church.
A third alternative is simply to handwave it. In Mage’s Masquerade and Not Bound by Honor, magic is common enough to be employed by the government and in war (there’s a reference in the latter story to one character saving Washington at Valley Forge by undercutting the ice magic of the Hessian wizards serving Britain). I simply assume that with magic on both sides, everything evens out: Despite Napoleon’s use of slaver crystals at Waterloo (backstory to Mage’s Masquerade) and his different motivation (creating a mageocracy to rule Europe) the British mages were able to win. As I’m only focusing on one small episode in each case, and not one involving a historical event (the take place, respectively, well after Waterloo and Yorktown), I think I can get away with it.
Sure hope so, anyway.