The first is in the scene when Galadriel allows Frodo and Sam to view her Mirror:

"'For this is what your folk would call magic. I believe; though I do not understand clearly what they mean; and they seem also to use the same word of the deceits of the Enemy . . ."

The next is when the Company is leaving Lothlorien:

`Are these magic cloaks? ' asked Pippin, looking at them with wonder.
`I do not know what you mean by that,' answered the leader of the Elves. `They are fair garments, and the web is good, for it was made in this land. They are elvish robes certainly, if that is what you mean. Leaf and branch, water and stone: they have the hue and beauty of all these things under the twilight of Lórien that we love; for we put the thought of all that we love into all that we make. Yet they are garments, not armour, and they will not turn shaft or blade. But they should serve you well: they are light to wear, and warm enough or cool enough at need. And you will find them a great aid in keeping out of the sight of unfriendly eyes, whether you walk among the stones or the trees. You are indeed high in the favour of the Lady! For she herself and her maidens wove this stuff; and never before have we clad strangers in the garb of our own people.'"

The suggestion, though certainly there are loremasters who know better then I, is that magic, as such, is very different in ME. It is an imparting of personal power into whatever object has been identified, whether that is a sword, a ship, a spear, or a Ring. Whether elves, men or dwarves (or even fell creatures) were more adept at this process then others, I would want to hazard a guess, since that's all it would be.

But as to the exact nature of "magic" in ME, it is vastly different then the defined magic of other stories such as the Shannara Cycle, or the Wheel of Time series.

-RR