@ZeCoster: One issue with your system is that it robs the MA (or AM in your terminology) of the option to initiate for a powerpoint (because the limit still applies).Also capping magic like that kind of kills the "Jack of all Trades" concept behind most MA builds that I have encountered.
Personally, I think the spells for powerpoint change is the best proposal for a solution we've had so far. Though, I do see a few issues with it:
1. Allowing the PP for spells swap frees up karma for other things. Some consider this a bug others a feature.
2. Allowing PPs to be bought with spell slots eliminates the cost or PP (almost entirely) for a build that focuses on the adept and summoning exclusively. If you don't want to cast spells, you don't need any.
3. The cost of a single spell at chargen is not really five karma. The cost of a spell beyond the budget given by priorites is five karma. This means that depending on which priority a character picks the value of a spell changes. This is made worse by the fact that the magic priority does three different things and the other two are likely prioritized higher than spells. Hence, if we equate one spell with one powerpoint, the cost of a PP bought with karma is fixed while the cost of a PP bought with a spell slot is variable.
One and two I don't consider much of a problem. Three however is more difficult to adress. Changing the amount of spells does not work as no one would buy PP at "double" the price. (Not truly double, but no matter what, spells are indivisible units and as such two will always be worth "more" than five karma, since you cannot buy them both back with five karma.) Making PP cost variable doesn't solve the problem either because then a ratio where the cost of a PP is lower or higher relative to a spell will inevitably arise. However, one thing is constant, no matter how much the cost of a single spell varies, it never becomes zero unless a character choses to forgo spellcasting altogether. Furthermore the changes in cost seem sufficiently small to me to not have an issue with it. (Skillpoints for example vary in cost as well.)
The most elegant solution, in my mind, would be to break the power of the magic priority and make them all give an even five tokens that can be used for powerpoints or spells at a 1:1 ratio. Then give players their spellcasting skill rating worth of free spells. Higher priorities would still get their free spells, if they pick spellcasting as a free skill. There'd be a few more spells to go around for mages overall, but I don't see that as much of an issue. Numbers can always be tweaked though.