[narfforc]

For with the consent of Eru they sent members of their own high order, but clad in the bodies as of Men, real and not feigned, but subject to the weariness of earth, able to hunger and thirst and be slain; though by their noble spirits they did not die and aged only by the cares and labours of many long years. And this the Valar did, desiring to amend the errors of old, especially that they had attempted to guard and seclude the Eldar by their own might and glory fully revealed; whereas now their emissaries were forbidden to reveal themselves in forms of majesty, or to rule the wills of Men or Elves by open display of power, but coming in shapes weak and humble were bidden to advise and persuade Men and Elves to good................

............But none of these chances were impossible to be; for, strange indeed this may seem the Istari, being clad in bodies of Middle-earth, might even as Men and Elves fall away from their purposes, and do evil, forgetting the good in search of power to effect it.

So to me it seems that the Valar had a great deal to do with setting the physical limitations of the incarnate bodies of the Istari, and therefore knew the possible implications thereof.

Did the study of the arts of the Enemy lead Saruman to create a ring, wishing to do good with it, yet turning his mind to evil, with the desire of the One Ring?