Most of this appeared in a reply I posted, but for organizational and access purposes I'm making this a full post.
Magic is largely invisible, though the effects aren't. That is, using magic to summon flame will result in a visible flame, but no magic aura or sparklies (I always hated the requirement in Champions that all powers be visible to three sense groups). Purely mind-affecting powers may or may not be detectable by the recipient, based on subtlety and awareness. I haven't decided whether anyone with magic can detect magic in use, or whether that will require a specific power. Most likely the former.
And oh yes, an inspirational picture:

I am deliberately leaving the source of magic undefined, though various hints will be dropped here and there. Honestly, defining the source of magic too rigorously would be counterproductive to the "hard sword and sorcery" element of the setting. (Though I have to admit to the amusement value of having at least one group calling their powers "Dottexes". "Do the first-aid dottexe, quick! )
Some random notes and ideas on limits. Bear in mind, a lot of the Andre Norton influence is going to be showing through here:
Magic basically moves matter, energy, and information around. It cannot create something from nothing (though it may appear to do so in some cases), and it definitely can't create intelligence. It's limited by visual information, or how well one can visualize the target or process. It also cannot transmute elements.
Lifeshaping breaks those rules a bit: simple healing and encouraging metaboloic processes is fairly easy, curing diseases harder and more time consuming, and regenerating limbs or reshaping the most difficult and time consuming of all. Giving a creature new features quickly runs the risk of serious (and icky) side effects. Genetic manipulation is the slowest of all, mainly works on plants, and is little more than a sped-up version of selective breeding.
I will have to do quie a bit more on Lifeshaping, and the engineered plants that are common in UTGM. The flora is going to have a lot to do with giving UTGM it's alien feel.