I like to think that Elven magic completely binds itself to the body, and sort of radiates out. To let the magic flow out freely they need to expose a bit of skin, otherwise they'll overload or something.

Is there any official explanation?

Panzar devs think they have chance to make the game increase by being revealed in China. And there in China it's something connected with law - that made devs change the mages' armors - it covers bodies more now; also there are no skulls in the game anymore (some skills had skulls in their appearance).

No more skulls? i thought there was a Berserker helmet that was literally an animal skull?

Not really what i meant. Some healer's skills included images of skulls, same about the firemage's balls (not the basic attack, the skill that costs 35-45 cp afair, shooting 3-6 balls out of the 'wand'). It's not important tho, just mentioned it as an example.

Will they be making any other changes for the Chinese market

All changes for that has been done I think. So just no skulls and no nakedness.