The only things that should give magical resistances to regular troops should be either rare items, mithril, or star-metal.
In Fall-from-heaven 2, magic resistance was only available to high level units, and only several units in the game were magic immune (including dragons).
Damage types were discussed in FFH2 development, and while it was agreed there would be no variation in physical damage (but different promotions would make you better against a certain weapon-class of unit), there should be several magical damage types.
Magical damage in FFH2 is divided into holy, unholy, death, poison, Cold, Fire, and Lightning.
some undead had death damage (and non-living were immune), only angels had holy damage (with a few exceptions), certain demons and others had unholy damage .... while most Spells either dealt Cold, Fire, Lighting, or Physical damage.
Assasins had poison damage, and if someone with poison damaged attacked you, you recieved the "poisoned" promotion until you were fully healed (which decreased strength by -10%, and decreased healing rate by 10 or 20% as well).
non-living were immune to death and poison, daemons were additionally immune to unholy damage.
There was no way to gain resistances to holy or unholy damage ... holy damage was good against unholy damage, to everyone else it was pure damage. You could only gain resistance to Fire, Cold, Lighting, or Poison after gaining the magical resistance promotion.
Most spells that caused large area of affect's were either Fire or Cold ... Fire was the most common effect in spells, so fire resistance was also the most common to gain. The theory was that by investing in Lighting magic, there was less of a chance people would resist you because it was far easier to get Fire.
Holy magic was the most rare, and there was no resistance to it (except I think angels were resistant to it) ... the holy priest "bless" spell would add 1 point of holy damage to living units for one battle, but the main source was from the Angelic Host (which was a late-game civilization)
In our case ... I can see Cold, Fire, Lighting, and Poison being fine fore Water, Fire, Air, and Earth ... nature-based poison attacks are one side of Earth, while the parts that include Rocks and Ground are pure physical.
I can see this being fine because to me Earth is nature ... including trees, vines, grasses, herbs, rocks, dirt, earthworms ... and so using plant-based spells, some with poison, as well as dirt based spells (physical attacks and terraforming), you are able to cover a wide variety of nature. Meanwhile Water Fire and Air are more of the destructive elements that run counter to nature ... and therefore they would be more magical in nature (or un-natural). In valuing creative vs destructive, Fire would be the most destructive and therefore potentially being the most magical. A being of pure destructive energy is very hard to destroy. Most likely an immunity to their own destructive power, and requiring banishment by something a little better than mundane ... like cold-iron, silver, mithri, or starmetal ... although due to the high defense of a Fire elemental, even these would only be successful in the hands of high-level warriors, other-wise you will lose many men fighting the beast.
I think the best counter to fire should be Water.
I came up with an idea earlier that Fire-based creatures/abilities should be good against Air and Earth, while Water can vanquish fire rather easily, but Water attacks have zero effectiveness vs Air. Meanwhile Earth is weak against Fire, Air, and Water ... but not affected by a person's magical resistances since its primarily physical damage.
As far as Life and Death, I think these should be rare forms of magic with very interesting consequences, perhaps more to do with army-creation and buffs. Or rather, I think Life magic should defeat Death magic, but Death magic creates large armies for the armies of life to try and defeat.
Therefore Death magic (necromancy) is the best for gathering large, scary armies of undead minions, while life is the best tool to defeat the minions of the undead.
I would of course wish for various elemental beings and angels/demons consisting of primarily one element.
A divine spell like "ring of fire" would be pure fire damage, while a Fireball would be half magical and half physical damage.