Ok so I dunnio what the deal is, but to get the magic armor your suppose to pay the guys in malo mart 1000 rupees, and then another 2000 rupees. Then you can buy the magic armor for close to 600.
Well After the original 1000 they told me they needed 2000 more...yet then I went and put the mirror back together then warped back to kark village, and this time they only asked for 200....
No idea why.
Spoiler Alert!The magic armor blows, it's only good if you are at the boss in a dungeon and you have a lot of rupees stored up from the dungeon.