I love William's answers. In particular number 5. Sometimes I think I'm in a camp of one. Jack and the Beanstock, Alladin, even Sinbad, these are famous characters that were out gunned, out stat'd, and if this were D@D out leveled, and they still over came their foes. In fact a lot of mythology deals with clever Joes beating the Gods or the Powers that be.
Perhaps I've played a Tytalus to long, but I do not think a gathering of magi should be afraid of one magus, whatever their stats are. As William listed, there are numerous solutions that turn the world against the bully/ArchMagus and leave the young magi on top.
On the Arch Magus, I agree that a clever Arch Magus would swoop in invisibly and destory the lot of you without you knowing he's there. But this fact brings me to a point I firmly believe. Any magus that shows up to a fight can be beat. If he's visible, it's that much easier.
First, the troupe can pick the location. Start hanging out at the local Church, sure your stats are down, but so are his. Now you have somekind of Star Trek Nebula senario where sheilds and tracking are no good.
Church to much, pick any location that favors the troupe and ruins the Arch Magi. Perhaps another covenant, or the King's forest, or fairy hill. Any place where the death of several magi will not benifit the Arch Magi.
Second, bring two dozen of your best friends. Yeah he's got a great Parma Magica, but how many arrows can he deflect? How many swords? It amazes me how many people don't try to punch a magi now and then.
In the last adventure I played my APPRENTICE Mercere BEAT an ARCHMAGUS by throwing a rock at his head! He failed his distraction roll, canceling the spell that would have killed me, fell over allowing the Byornear apprentice (in Bear Form) to pin him and surrender. Two apprentices BEAT and Arch Magus. Yes, it was touch and go. Yes I thought it was an absurd situation that as a GM I wouldn't have done, but it was the senario I found myself in and as all the other apprentices shot spells they knew were going to fail, I started throwing rocks.
Finally, I strongly encourage players to move away from reactive role playing. The Princess needs saving? Let's go! At High Noon, the Arch Magus is coming for us? Let's prepare!
Get PROACTIVE. So at High Noon the Magus is coming for us? How about, Let's go right now, seal the door to his sanctum and then flood the place with non magical odorless poison!
Are you breaking the code? Well he's going to kill you anyway, so worry about that later. Hint, don't order the companions to do it, simply discuss some 'wishful' thinking. What the companions do on their own time is their own business. Think about that.
I think a lot times role playing becomes a "how do we survive the storm senario", and while thats fun I think it can be more fun to get proactive and say "Lets control the weather- no more storms." That sort of purpose driven role playing moves the game forward rather than it being 'pulled' along by GM plots.
Hope this helps, and I hope you guys take that Arch Magus out before he wakes up this morning.