Hmm, I've gone over this before, but I've never been of the school that thought Magus ever put Schala second to Lavos. I can see how you'd think that, but the fact he's such a withdrawn person - combined with clear evidence of his longstanding affection for her - makes me believe she's at least as much of a priority. It's also quite plausible to me that Magus understands that Lavos and Schala are linked. It's hard to make a case either way, but I think it's unquestionable that he loves her very much.
Regarding shipping, hmm... people tend to respond strongly to the intensity of Magus' bond with Schala, and I can see how that may lead some to ship them. However, I like the uniqueness of a rare platonic bond of that magnitude and the fact that our usual notions of a nonsexual relationship don't jive with how uncomfortably close and devoted to each other they seem to be. I suppose I can just say they're a lot more interesting to me when they're not potrayed as "in love." I see the appeal I think, shipping is quite an individual thing, but I like to focus on why they are close and not necessarily how they are ~in love~. The fact they are brother and sister forces you to consider their actual connection rather than placing them in this prescripted romantic context. You know?
Of course, Byron was actually in love with his half-sister, which seems to make the comparison I made before a bit more apt. The Romantics had a huge obsession brother-sister relationships in general, actually... they were attracted to them as symbols of purity and closeness, but again, I just don't think that you necessarily need to go a sexual route because of the intensity of the bond.
(Auuuugh Kato, WHY did you create this incredibly nuanced relationship and then NEGLECT TO EXPLORE IT FOR A CARNIVAL OF PLAYABLES IN CC. WHYYYYY. okay I'm done now.)