I'm thinking of using WFRP 2e, but with an entirely different setting.  Most of the rules are pretty setting neutral, but magic, both arcane and divine, stick out like a sore thumb.

The simplest thing I can think of is to take all the spells from the base book and RoS and combine them into different schools.  It's been established in setting that arcane magic is divided into disciplines akin to D&D spell schools.

All magic stems from one of the two gods of the setting.  Divine magic should be more flexible and it's effects more subtle.  Arcane magic is an attempt by mortals to master the secrets of the universe without resorting to the gods.  Its effects are more codified and rigid.  Divine magic is used to create, boost, restore, and inspire.  Arcane magic is used to manipulate, destroy, divine, and subvert.  A third type of magic, Druidic for lack of a better term, is a synthesis of the two.  All three types are tied to the cosmology of the world.

One thing I'd like to brainstorm is ways to limit magical use without Tzeentch's Curse.  I was thinking of adding spell points, but that seems rather bland.  So any thoughts on that are appreciated as well.

Note: If this needs to be moved to Design and Development feel free to do so, or I can move it myself.

what's the downside of keeping the system the same but just changing the fluff?

I'd like the system to reflect the setting somewhat.  I'm not necessarily talking about redoing all the spells, but I am looking for different ways to group them, cast them, and limit their use somewhat.

Tzeentch's Curse/Fury of the Gods works for Warhammer, but not for my homebrew.

I hate to tell you, but if Tzeentch's curse, a very fundamental part of the WFRP magic system, doesn't work for your homebrew, you might be using the wrong game for your homebrew.

RPGPundit

The thought has occurred to me.  

How do other percentile systems compare to WFRP?  Our group likes Warhammer because of the number of options for customization combined with relative simplicity.  The combat system is also a dig draw.  Really it's just magic that sticks out like a sore thumb.

Still it's not set in stone so I'll keep looking for a base if tweaking magic turns out to be more trouble than it's worth.

On topic though, I've thought of simply re-imagining Tzeentch's Curse to something less corrupting.  That seems more like a compromise option.

Well, there's Maelstrom.  It is cited by some as having possibly been an influence on WFRP 1e.
Its got a similar gritty feel, is based on renaissance england, and uses a percentile system (and has a variety of warhammer-esque weird "not typical PC class" style occupations).

It has a very loose magic system, based on the manipulation of probability.

RPGPundit

It seems to me that the main role Tzeentch's Curse and Wrath of the Gods plays are as restraints on profligate use of magic, thus balancing it.  If you're going to remove them, or tone them down you risk magic dominating everything.  You may need to go the way 1st and 3rd editions work, namely some form of spell point system.  Other d100 systems also use spell points, based on a characteristic (3-18 range) with spells costing anything from 1-6 points to cast depending on power.

Hope that helps.

An answer so obvious I should be shot.  I never used magic in 1e so it wasn't in my mind as being something different than 2e.  I'll look it over and see how it'll fit.