How common should magic be in the setting?
Common and rare. The common type of magic are things you can buy in the ol' magic shop (healing potions and such) that is run by a low level, middle level retired wizard. Rare things are world shattering apocalyptic prophetic ritual things (like the Gate or Planar Binding line spells) that need special places/time/sacrifices in order to activate.

How powerful should magic be in the setting?
For the common side part of magic, things that imitate technology: lighters, etc. For the apocalyptic line, it's multiverse chaos and carnage.

How close to the historical real-world should the setting's politics be?
Depends on the theme, but since people will be always people, some closeness to RL politics could be nice.

THEMES:

Grim (it's iron-dark ages), Unknown (for the vast majority of the common folk and even some famous adventures), War/Cold War (because it must), Morally Ambiguous (same as before, but more common in the upper end of the politics), Underdogs THEN Change.