Well,if you say magic is really poor in dmg, you're probably (and most surely) talking about destruction. Yes, it's true, it's quite underpowered, compared to melee. But the rest of magic is actually quite powerful. In illusion, if you have the proper perks (no need of potions) you can use all spells to anyone whose level is lower than 80, and characters whose levels are higher than 80 are very rare in skyrim. In alteration, you can paralyse someone for up to 33 seconds, and paralyse an area for up to 22 seconds. In restoration, you can heal yourself for up to 700 health whenever you want, and thus you dont need potions anymore. And finally, the most powerful school in magic: conjuration. If you have a volkihar vampire thrall, equip it with a very powerful weapon you enchanted and improved (no need of the enchanting-alchemy-smithing cheating), it can kill almost anything. Also, vampires dead thralls can regen at night if you have dawnguard (I don't know if it's a bug or it's intended).