My theory has been that even earth and pegasus ponies have a very small amount of magic, but they can't do it from any sort of distance without a horn (and couldn't do more complex things). Horns and hooves are similar in their makeup, afterall.
FYI, I moved this from my favs to my "1st class favs" folder. I reserve that for my absolute favorite art and this definitely makes the cut. It's really hard for me to put a finger on what exactly about this is so awesome, but it really, really is.