The intent of this designer was that magical items were able to be used actively, and in most cases would be.
Note that there isn't any difference between "magic bonuses" and "mundane" ones. A "Great Strength feat 17" provides exactly the same bonus as a purely mundane "Strong 17" when used as an augment.
You can use your "Blinding Shield" as a simple augment (not a good idea, as you've stated), or you can use it actively as a defense, or an offense, or as a flashlight (assuming the "blinding" is light based and a steady beam), or a stealth item (assuming it's not light based, but some sort of physical blinding or darkness power), or a strobe system for your disco... A lot comes down to the description of the power in use.
Thinking that things can *only* provide an augment isn't using the system to its fullest.
It is by my order and for the good of the state that the bearer of this has done what he has done.
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