This is in Aion China, Values may differ in other versions
I did some test on my 38 sorcerer and I come with solid results about Magic Boosting and how it affects damage. I'll let you interpret the data as you wish.
Tooltip Damages of Tested Skills
Snare Chain: 444
Flame Fusion: 418
Flame Bolt: 584
Base Damage w/ 19 Magic Boost (Stupid passives)
Snare Chain: 428
Flame Fusion: 403
Flame Bolt: 566
Damage used for Testing w/ 59 Magic Boost
Snare Chain: 441
Flame Fusion: 417
Flame Bolt: 584
Damage w/ 1060 Magic Boost
Snare Chain: 794
Flame Fusion: 748
Flame Bolt: 1049
% Increase of 1001 Magic Boost
Snare Chain: 80.0453515%
Flame Fusion: 79.3764988%
Flame Bolt: 79.6232877%
Damage with 537 Magic Boost
Snare Chain: 609
Flame Fusion: 575
Flame Bolt: 806
% Increase of 478 Magic Boost
Snare Chain: 38.0952381%
Flame Fusion: 37.8896882%
Flame Bolt: 38.0136986%
Conclusion:
10 Magic Boost increases damage by roughly .8%
100 Magic Boost increase damage by roughly 8%
500 Magic Boost increases damage by roughly 40%
Hellfire does not work this way though. I did roughly 4027 damage w/ 1169 magic boost. According to the above percentages, I should have done around 2947. Guess more testing is required.
A level 50 Sorc w/ Best magic boost gear and all +25 magic boost manastones fully buffed w/ Flame Robe, Food Buffs and a Chanter has around 207% extra damage including the +% pvp bonus.