This refers to the study of magic and of the history of magic. Theoretical magicians arose after the decline of practical English magic consequent on the departure of John Uskglass. They conserved old texts and compiled histories of magic, formed clubs and societies in which they endlessly discussed and argued about its true nature - but they did not practise it. Indeed, over time it came to seem undignified and childish for a magician even to attempt to perform a magic spell. The study of magic and of its history remained respectable, while its practice was left to charlatans and street-sorcerers.
That is why the gentlemen of the Learned Society of York Magicians were a little affronted when their most recent member John Segundus asked the question, why should this be so? Initially of course Mr Segundus himself is an example of a theoretical magician, as are all his colleagues in the Society. Only after the pioneering work of Jonathan Strange and Gilbert Norrell transforms the situation, and especially after Strange begins the liberation of English magic, do Mr Segundus and the rest become again practical magicians.