Well, the build-up by Shad0w is now making me think I'm missing something, but it just seems to make sense that:
1) Magebane is in play, and any time that target mage casts and resolves a spell, they take a point of DD.
2) Dispel is cast, which immediately fulfills the pre-existing condition of #1.
3) It can't dispel without damage, because it has to resolve before doing so.
I think it comes down to Magebane being a pre-existing effect.