But even magic has limitations within it's own mythos. Magic doesn't mean that you can do anything unless that mythos allows it to.
Sure magic should have limits within whatever system the designers decide, but is limb regeneration really even getting close to the realm of over powered or embarrasingly excessive? In a world where people can conjure fire, ice, and lightning like they were passing wind; where summoning skeletons, scamps, or atronochs of various colors is prevelant, I don't see it being a reach in the least for healers to restore a limb.
After all if I've a character with a max of 180 HP and I'm limping along with 4 HP then cast a healing spell or 2 and inside 5 seconds I'm back at 180, do we not presume that not only cuts and bruises were healed but also perhaps some cleaved flesh replaced and broken bones set?
I'm not for the cleaving of appendages (for the player or NPCs) but if they went that route, I think magic restoration of limbs would be completely appropriate. Though other options could be more comical, such as having to pick the limb up and carry it as an item to have magic reattach/reanimate it; or a mahe causing a 1/10th size arm spring from your shoulder that slowly grew over a couple hours game time.