Blue Magic is essentially the ability to learn via observation. A GM has several options reguarding Blue Magic:
Disallow it completely
A GM is permitted to disallow Blue Magic, either because he believes that it's too powerful, or too much work. My suggestion is to try it before you kill it, because it not only makes the Sage a formidible guild, but also adds a little depth to their secrecy. If you just don't want to let your PCs use it, consider just disallowing the Sage as a PC guild, and let the NPC Sages turn your PCs blue in the face trying to figure out how they did that.
Allow it on a limited basis
If a GM decides that he likes the idea of Blue Magic, but thinks it's too powerful, than he has a couple of ways of restricting it's power. He can disallow supernatural powers that don't emulate a spell, he can disallow the spell-like abilities, he can disallow the actual spells, he can cut the learning percentages, making it harder to learn powers (see the fourth option), or he can combine any of the four. Note that all supernatural and spell-like powers that can be emulated via Blue Magic will be denoted as such in the user's description, as well as any other pertinant information, such as spell type and rune types, if relevant. A GM may also disallow certian powers, if he feels that only specific ones are too powerful, or even limit progression on the more powerful ones.
Allow it for Sages only (recommended)
In this situation, Sages have kept the secret of how Blue Magic works, and are able to pick up how others do things with it. Use the rules for Blue Magic as normal.
Allow it for everyone, but penalty if not a Sage
In this situation, someone let slip how Blue Magic works, and now anyone can learn special powers by observation. However, since Sages have studied it for so long, only they have truely mastered the art. Thus, if a non-Sage attempts to learn something via Blue Magic, they get half the percentages used for learning abilities if they are a Mage, or a quarter of them if they aren't. Additionally, a GM may decide that a non-Sage isn't able to work on learning multiple abilities simultaneously, and thus must start over on learning an ability if they want to start working on a new one.
