I’ve read the Silmarillion twice, and it’s sort of the “Genesis” story and Old Testament of the LOTR world. All the Old Gods, their squabbles, creation of Elves, Dwarves, Men, etc. I don’t think I would have missed the exchange of magic for life, though there is definitely an inferred consequence that use of magic takes a toll like overexerting oneself, especially when battling another magical being, but that seemed more of a plot tool used to arrange characters as needed. Plenty of evidence that baddies keep coming back and get stronger, and also some evidence that lack of magical beings in the world makes the world less magical as a whole - iow, this world doesn’t have permanent magic affixed to the place, it almost seems like it needs believers and practitioners for it to exist, and as they die or depart West, magic ceases to functionally exist along with the “ascent of Man” at the end of LOTR.