Maybe they did rule the countries, but did it from the shadows. Ruling a country directly makes other magic users focus on you, especially if you did some morally questionable stuff to take power, or suppress the peasants. You could just as easily take control of some puppet rulers. If they peasants decide to rise up because of the poor living conditions, they'll kill you puppet ruler, but you can just start over with the next one. Take care with how you do it and the other magic users will never do anything against you, making it a much more attractive option. If most countries had these shadow rulers, it would also make sense as to why they never reveal the masquerade, as it could cause the peasants of their own country to notice them. After a couple of centuries, it is common sense among magic users that anyone who tries to break the masquerade gets assassinated by their fellow magic users. Skip forward to modern times, and this has resulted in special organizations that enforce this, and as their moral standards progressed, these organizations basically become the magic law enforcement.