Naruto's powerscaling is excellent. In fact it is one of the things I like about it the most because it's fleshed out so well.
There's just no comparison between Naruto and Dragon Ball. In Dragon Ball, whoever was fighting two volumes before is certainly outmatched by lightyears in the volume you're reading, and that guy was already overpowered in comparison to everyone else two volumes ago. In Dragon Ball everything stops being relevant after a very short time - Piccolo reuniting with Kami after eons living as separate beings, only to find himself overpowered the volume after and out of the league of relevant fighters since then. The whole Freezer saga builds up to the awakening of the legendary super saiyan, which then stops being anything legendary or unique the series after that.
As much as I loved Dragon Ball as a kid, and Saint Seiya, these two were a disgrace to storytelling. It was a disaster. It wrecked any credibility that shonen manga had after Fist of the North Star. It all got about something overpowered that trumps something that was already overpowered only to be trumped afterwards by something even worse.
Compared to these, modern shonen manga do better work by far, not only Naruto but also One Piece, Bleach, Soul Eater (I don't know Fairy Tail or Tutor Hitman Reborn enough to say if it is the same), and even the Saint Seiya gaiden(s). It is not as guaranteed that someone showing up in the first episodes is automatically outpowered nowadays, Kakashi, Tsunade, Hiruzen, Guy, none of them had become useless fodder currently, and trust me if this was Dragon Ball they'd be useless trash by now. There's a lot more about matchups, tactics, strategy and clever use of super-powers than in most shonen of the past age.
It's true, though, that magic powers get progressively more convoluted, powerful, and common, but that's a natural. In a warring society where magic is a weapon, people are bound to seek more and more overpowered spells and abuse them or search a counter to them. In fact, the opposite would be unrealistic.