You spend chargen karma during step four of the chargen process.
Each character receives 50
Karma to make a little move forward. The points
are spent on skill or attribute advancement, as
well as additional funds to get those last gear
pieces you might have missed or an additional
quality (though the limit of six qualities still applies).
See Character Advancement (p. 68) for the
price of buying these advances.
Remember that you can spend Karma to buy
cash for the next step at a rate of 2,000 nuyen per
point of Karma, or 5,000 with the In Debt quality.
TL;DR: You can spend karma on:
1) Attributes
2) Skills
3) Qualities
4) Gear
4a) Converting karma to nuyen for more 4) Gear.
So this means no:
Initiating
Buying Spells
Buying Complex Forms
Bonding Foci
etc. etc. etc.
The lone caveat I'm aware of:
Martial Arts are purchasable with chargen karma (Firing Squad, pg 97). That retroactively adds a 5th thing you can spend chargen karma on.
Edit: I see you're referencing the German language edition, which I can't comment on. Not only do I not speak German, Pegasus is empowered to make what end up being in effect changes to the game. As an example, as of the last time I checked the Pegasus CRB they had a different erratum for the Ares Dragon's body stat than CGL issued. So, it is what it is, depending on which edition you're playing! If in the German language edition Step 4 doesn't copy the CGL's text that fails to allow for spells, then maybe it is possible to buy spells in the German language version of the game. But that has no bearing on the CGL/English language edition.
Edit edit: It's been brought to my attention since I originally posted that chargen karma is indeed fully fungible in the German/Pegasus SR6 rules. And I must concede that there is no formal ruling given for English that is conflicting with that, so if your table prefers it that way, by all means play it that way. But do bear in mind that if you play it that way, then yeah... the Magic Priority pick IS basically broken as the OP discovered. Also bear in mind that for SRM, there very much IS a formal "clarification" that in organized play the restrictive reading is in play. So bear that in mind if that's what you're building a character for.