http://en.wikipedia.org/wiki/Maelstrom_%28role_playing_game%...
Essentially, the DM judges the difficulty of a particular spell based on how unlikely it is.
So a lightning bolt in the middle of a cloudless day would be more difficult than accidentally finding a weapon on the street in the middle of a fight, which would be more difficult than your opponent stumbling and dropping their weapon.
If something like a hypothetical transparent force field invoked by thought, words or gestures, that can stop bullets, blades and fire in mid-air isn't actually known to be possible and might warp reality, would it warp reality more than time travel, which might be possible on paper, in certain ways, although not readily understood?
Compare to, for example, Nobilis, which allows assorted flexible impossibilities but is crafted to encourage certain effects on both theme and the actual flow of gameplay.
If the DM can't make an entertaining story without 'rules', then why even have a DM?
I've hosted RPGs with nothing but a pencil, paper and some dice.
For example, Dogs in the Vineyard encourages/threatens players with the risks and rewards of escalating conflict, Nobilis tries to get you to reenact a game version of the Sandman comic, and Vampire: the Masquerade rewards you for treating normal humans like pawns and playthings.
It also makes for very creative magic, since you are essentially handing the magician player an opportunity to effect the plot directly, in however they so imagine (and the DM and the dice permit), rather than giving them a gun with so many bullets in it, ala D&D.
See also David Drake's Northworld Trilogy. Though that's more science fiction than fantasy. And Keepers Chronicles by Tanya Huff.