When the fire witch tells them about the spell for the amulet she says that the magic words are: "let that which IS done be undone". The first and second times they use the amulet they say the words correctly, but the third time they say "let that which WAS done be undone". The spell shouldn't work since the words are wrong.
If the amulet really does reverse time, then everything needs to be reversed. At the end, the team use the amulet to prevent Freedonia from being destroyed - and the space station is thus reconstituted, but nothing else is reversed. Uglor should have been returned to Freedonia, since that was where he was when he set the station to explode. The team should have also been returned to where they were before the station blew up.