Why is "The Gift of the Magi" an appropriate title for this story?
An allusion is an indirect reference to something. You are prompted to think of something without having had it mentioned. The Gift of the Magi alludes to love and sacrifice. The three wise men brought earthly gifts that were deeply revered by kings and royalty. Their travels and their sacrifices were for naught, however. The king they sought to honor with the gold, frankincense and myrrh had no use for such things. They were probably shocked to find that the royalty they had traveled so far to see was but a mere babe, who had no need for such things. But the love that was the true basis for their visit was repaid many times over. That was the true gift - the love, not the offerings.
This allusion that the title is referring to has to do with the religion of Christianity. Christianity is centered around Jesus, and when Jesus was birthed into this world three Magi were called by God to visit him. According to the Bible Magi were the wisest men in the whole country; often the King's advisers. Because they were so wise they brought only the smartest and best gift for baby Jesus. Likewise, this story draws a connection by implying with this title that Jim and Delia gave each other the wisest gift they could.