I could not find any references other than the Mariculture Wiki which says the magic mirror should be unbreakable, but I find it is taking durability damage every time I use it. This also makes it impossible to upgrade. Was this a change in behavior or a bug? And is it already fixed in later versions?

Was a behaviour change, you can repair it with pearls though in a vanilla anvil

Just used the blacksmith's anvil to repair it. I also added unbreaking 3 to everything to help mitigate the "issue". Will keep in mind that pearl option though!

Maybe I should of suggested something from my own mod xD