That is a really good point!I do think limitations are important, but I wish sometimes we were a little more clear about why. I used to interpret "magic should have limitations" as "your magic shouldn't be too powerful because it will break the plot", which caused me to close off a lot of potential ideas for how my stories could go before I even explored those ideas--which were oftentimes the coolest ones. Whether the magic might be too powerful isn't something you should never consider, but with the help of good editing and a little suspension of disbelief you can push things a lot further than you might initially think you can.
In my opinion, limitations should be less about taking the same idea you originally had and watering it down and more about narrowing the focus. I see a lot of broad, all-encompassing magic systems that blend together and aren't very distinctive because they basically allow the characters to do anything. A lot of times, there are complicated, mechanical rules behind it, but I find that's rarely enough to make these systems interesting. A narrower system allows the writer to dig deeper, and it allows the characters to be more creative with their powers instead of just going for the most obvious solution.
It's really less of a matter of limiting things as it is choosing what you want to explore and getting rid of other options so they don't distract or muddy the waters.