I was assuming that once you kill the Tyrant and you are prompted with the floaty text that magic has been restored, that - well all of my gear would return to normal. None of my gear has returned to normal...???
there is a giant pillar behind the spider demon looking thing, you need to re arrange the runes on the ground to the right rune on all 4 sides and then your magic/items will go back to normal
( its a pretty easy puzzle once you know what you are doing, you just have to match the runes in a line and each rune already has the first one done for you, you just have to match each line to the rune its in )
There is a bug what was introduced a few updates ago that if triggered, permanently destroys your gear. The triggering condition is fighting the Bebilith before solving the pillar and restoring magic. (I wonder if the condition is actually henchmen dying, or being dead, when magic is restored.) Regardless, if you can't get past the door (2 doors, actually) that lets you get the magic, you need to leave the area without engaging the Bebilith
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( its a pretty easy puzzle once you know what you are doing, you just have to match the runes in a line and each rune already has the first one done for you, you just have to match each line to the rune its in )