Sanhedrin 46a is one place to find the idea, the gemara says it beferush, that beis din gives makos and can kill shelo min torah velo laavor al divrei torah, rather to make a siyag. The gemara then brings two examples of this; one was a man who rode a horse on shabbos, and was given skilah, even though it’s derabonon. There was a man who had relations with his wife under a tree, and he was given makos – the gemara ends off by saying that they didn’t deserve it, but “hashaah tzorich lekach”, it was needed in that time to prevent people from sinning.
Like i said earlier, he tested them and only killed them after they demonstrated their kishuf.
Also, it seems that these are “nip it in the bud” type issues; if something is widespread already, I don’t think that we would enploy horaas shaah, but i could be wrong about this.
Regarding magicians and sleight of hand, according to the rambam there are different levels. “Achizas aynayim” as termed by chazal would be permitted, which would include parlor card tricks, pulling a never ending ribbon, and others. Grander illusions that seem to show true power over creation would be kishuf and a chiyuv misah. Magic shows that are common even in the frum world are allowed if the magician demonstrates how to do one trick, and announces that this is all an illusion and not real sorcery. See Iggros Moshe YD 4:13, and rav Belsky in shulchan halevi page 138.
According to the rambam, the fact that the practitioner is trying to make others believe he is a sorcerer is enough to violate the issur.
See also chochmas odom 89:6 who prohibits badchonim by weddings to perform magic tricks and has some very strong words on the matter