The coupling between guided optical waves in magneto-optic fiber Bragg gratings (MFBGs) with linear birefringence is investigated using the eigen-mode and coupled-mode approaches. The relationship between the polarization-dependent loss (PDL) and the eigen states of polarization (SOPs) in the MFBGs is discussed. Only the MFBGs with low linear birefringence are applied to the peak PDL-based magnetic field measurement, after which the linear dynamic range is determined using the relative magnitude of linear and magnetically induced circular birefringence. In this letter, a theoretical model is presented to explain the experimental results and help develop novel MFBG-based devices.