Well, this is all well and good, but let's look at an example - a wand of magic missiles. Now while acquiring this wand spanned multiple games, got people really excited and has resulted in some hilarious "off line" emails in how they tested it to figure out how it works, but the DMG says this sucker is worth 35,000 gold pieces and 4,000 experience points.
(Those magic items not sold gain only a relatively small amount of experience points, for their value is in their usage.)
Now I know, BTB is BTB and for my campaign, not always applicable, but I'd like chew on this a bit here. Based on those values, I can say that the XP value for this item is roughly an eighth and a half of it's value. That's not a formula that follows in the XP/gold value ratios for other items. It seems there's a relative value based on the difficulty of making the item, but that is still a huge jump.
Now, for wands, there is an interesting note that says "Assumes full charges are in the item", which I'm not quite sure how that would affect XP, unless they are ranking the value's "worth" and XP on how many times this lil stick is gonna pop a monster for 1d4+1 (twice a round too!) OK, so the max charges are 100, so lessee... that's about 40 XP per charge and 350 gold per charge. While I can understand the cost, given it takes a 6th level spell enchant an item which can be cast only by a 12th level wizard or higher, and requires a crap-load of components to make, for a 90 charge wand (on average) that's 3,600 XP. So some first level wizard who was on a quest and participated in finding this magic item and somehow gets to keep it is going to now be 2nd level just for holding Fizbin's thingie. Same with 2nd level - it's an automatic upgrade.
Is this how AD&D balances things - mages usually get the magic items, so because they need more XP, they get more powerful by dint of finding the magic cookies? Am I just being stingy with the concept in my head?
I'm leaning towards thinking that I'm going to go BTB for several reasons. Mages are already on fragile grounds, unless they're doing double-duty as a multi-classed demihuman. The human mage is still 2nd level, but close to third, if I remember correctly. I also go back to the eXPloration justification - if a fresh/newly minted first level character picked up a wand of magic missiles, should they get 3,600 XP for a wand of magic missiles? Should that bump them to 2nd level?
Given that magic is so rare in my game, yes. I think I don't have a problem with that. The players are slowly beginning to find stuff, but not anything near what most people might expect in a D&D game. I want magic to be mysterious and cool and valued when found. To me, XP isn't just about a person's own ability, it's also about their standing in the world, their ability to do things and their overall "power" that comes with the stuff they carry about. Heroes in Chainmail were powerful in many ways, not just because they'd crossed swords with hundreds of orcs.
Side note - It's a testament to one of my player's tenacity that as an elf fighter/mage, he's hit 3rd level in each. If he'd been in one or the other as a human, he'd probably be the most powerful character. Of course, he's coming to almost every game.