I was contemplating the idea of the Nevernever, but the party is sticking to their guns for a D&D-esque game, so having it in another dimension of the modern world wouldn't exactly help the case.
There's nothing wrong with setting it our past, either, in whatever time and place you find interesting. If you visit the oft-referenced (for good reason)
http://www.rickneal.ca/, you'll find that he did just that for his DFRPG game. If you just say that there was a time when creatures from the nevernever felt free to cross over and cause chaos (before the white council solved it? before the accords?), you get a DnD style game pretty easily.
System-wise, you don't need to change much. Unless the players are all against "guns" on their sheet, you can leave it as it already covers archery. (there's a stunt for it, maybe?). Just make the stunt the default, and make them take a stunt to use guns if some type of flintlock or such is available in your era. Scholarship can stay the exact same, just limit the knowledge and stunts to era-appropriate, and even drive can stay (wagons, boats, ect). So nothing has to move at all.
As for your Fate Point for Evocation: I think it would be a rather steep cost, especially if they are going for a Rote spell or something that is only causing one point of stress. I don't have a solution for this just yet either, but a Submerged Wizard should be sitting on 4 Mental Stress, and possibly a second Mental Consequence, so I haven't seen a problem with it in theory (note I haven't had the chance to get a game off the ground, so everything on my end is just theory).
I wouldn't increase the cost of casting. You're already tapping an evoker out at 4 stress before he's "out of spells". The solution to this is two-part: one is when you change scenes (clearing stress tracks), the other is for evokers to take some potion slots and use those for easier, often used spells. You don't really even need to increase stress tracks if you are cutting scenes more often (one battle doesn't have to equal one scene, even if it usually does in our minds. I have cut-scene in the middle of a battle specifically to empty stress tracks for dramatic reasons). This clears all stress tracks, so you lessen damage as well.
Ultimately, if you go DnD-style, or if you have smart players, they'll get armor or armor spells, plus shield spells, and you'll be amazed at how much damage gets negated by that.
When it comes to the stress vs consequences: by leaving the stress as-is, characters may be forced to take Consequences over smaller conflicts, which detracts from the heroic fantasy. While the Minor consequences heal quickly, it's those moderate ones that can leave you out for a bit. With more stress, a character can shrug off a bit more in a fight, have less of a chance for those consequences in a minor skirmish (still possible, though), and still be bruised up. If anything, perhaps a combination of the two would be in order? Minimum 3 stress, add another minor consequence (as they go away quickly enough)?
If you feel it's necessary. I run a pretty solid combat game with rules as written (RAW). The first extreme consequence finally happened, but it happened in the epic story-arc resolving battle. Again, I'd see what you can do with armor, shield spells, and scene cuts. Plus, adding healing....
As for healing: a part of me is thinking of taking elements of Elaine's Reiki "spell" and the general theories of biomancy and tack it on to Sponsored Magic [Deity]. Keeping it base base Complexity 4 + Level of Consequence to be Lowered (2/4/6). Even a someone with a +5 relevant skill will be taking some pretty heavy mental backlash from this, not to mention the need to RP the debt with the sponsor. The Instant-Heal thing, or even resurrection in some settings, would be even bigger, meaning if a player is doing it, they may need to worry about how they'll manage it, and if it is placed at the feet of an NPC, there may be the need to expend Fate Points to "compel" the event to occur.
Healing is actually really easy. That person with sponsored biomancy gets four freaking focus slots. So discipline 5, conviction 5, and a "healing wand" of (+2 biomancy complexity, +2 biomancy control, make sure they have requisite lore for the bonus), plus usually the sponsor gives some bonus that for a healer you could call (+1 biomancy complexity, +1 biomancy control), gives them, with no refinement, a total of +8 biomancy complexity and control. That's all at just -4 refresh for sponsored magic. That's your mild and moderate with no backlash (assuming an even roll). AND, that's assuming you even USE it as evocation, which you aren't obligated to do. Post battle? Say screw it, use regular thaumaturgy, pay no stress... or take the stress as it clears when you start the next scene. Mid battle? Run around the corner, throw a circle around your buddy, and thaumaturge it for no stress. Or use potions for it (buying refinement for crafting to up potion strength, and buttloads of potion slots).
Also, consider that the group "Tank" doesn't have to be a mortal wizard. Call it a changeling, or a god-child, or w/e, give them inhuman toughness and recovery. Extra stress boxes, clears a mild consequence for free.. ect.
-2 inhuman recovery, -2 inhuman toughness (catch, 0 points, "inherited silver arrow once owned by Achilles to the heel" or something equally hard to obtain), +5 endurance = good group tank at -4 level. Make the catch worth more to free up refresh to buy stunts (like an extra physical consequence). Hell, put those powers on a suit of magic armor (giving a discount to them) and a catch of "A holy weapon wielded by a righteous man" and you could end up with them costing you only 1 refresh, or giving you a better level of protection. PLUS you could, as the ST, "enchant" the armor so that it is armor 3 or 4 all the time. Or, armor 6 three times a session, or whatever nonsense you want to add to your item of power.
Now, that does nothing about your wizard with no endurance, 2 physical stress boxes, and all... true. But he's a wizard! In dnd, he could die from a cat fight if it went by hitpoints. He needs to look elsewhere (other than system changes) for his protection.
Another quick example:
Evoker/Thaumaturge (specialize spirit control +1, specialize crafting item use +1) = -6 refresh
Lore 5, Conviction 5, discipline 4 (unless limited to max of 4 due to your power level i guess)
4 available focus item slots
crafting wand = +1 item power, +1 item use (2 slots)
2 open slots = 4 enchanted item slots
slot 1 = strength 6 shield three times a session
slot 2 = armor 3 three times a session
slot 3, 4 = open for character development OR increasing armor/shield use/power
That's a pretty basic protective set-up, using just the free stuff with your two types of magic. Now if someone hits you for over 6 stress, you absorb 6 of the attack strength on the shield, then ignore 3 of the damage due to the armor... so if someone with an arrow (weapon 2?) shot you with 8 successes (they were a master +5 archer and rolled 3 pluses), 2 get through to add to damage, so 4 total stress, you ignore 3 of it, and you take 1 physical stress before you melt him into nothingness with your magiks. You can go pretty toe to toe with a physical opponent (not a monster, though) and probably not hit consequences beyond mild before you've killed him.