It was a strange spectacle. There was Mayor Marion Barry, warning through a spokesman last week that the D.C. City Council was using "fiscal mirrors" in its attempt to protect 3,500 working poor families from cutbacks in assistance ordered by the Reagan administration.

In the tradition of D.C. election-year magic, council members declared recently that they had "found" $5 million in the city's lean budget to stave off the cuts. Barry insisted the money just wasn't there and that the council's action merely was raising false hopes. This advice sounded somewhat peculiar coming from Barry, who has displayed a knack for budget wizardry during three years in office.

Twice last spring he found additional funds for the D.C. school system after insisting the money just wasn't there. He boasted that he ended fiscal 1981 with a $7-million "surplus" after warning Congress last winter that the city faced a $60-million deficit. And he reopened and sweetened a politically sensitive, three-year contract with city police officers last month after preaching the need for budget restraint.

Several council members bitterly complained that Barry was playing political games by arguing against council proposals on grounds of austerity while consistently finding ways to finance initiatives that get him out of tight spots or enhance his standing.

Council chairman Arrington Dixon, one of Barry's political rivals, said this week that the mayor's uncanny ability to scrounge up funds for his pet projects "raises serious questions about his credibility."

"The cookie jar is always empty when we want to get something out of it, but there always are cookies when the mayor wants them," said Dixon, who is not adverse to mixing his metaphors. "It makes you wonder what games are being played with mirrors and smoke."

Dixon said he was particularly incensed by Barry's decision to reopen contract talks with D.C. police, after reaching a settlement last July.

"We would have been glad to give them (the police) more, but we were told (by the mayor's budget experts) that there wasn't enough money," Dixon said. "But once the deal is cut, then suddenly there is more money for the contract."

City budget director Gladys Mack said that Barry's critics had overstated the impact of the revised police contract on this year's budget, but conceded that it would cost the city considerably more in future years. "So the mayor isn't really 'finding' much money this year," she said.

Philip Dearborn, who recently completed a nine-month stint as Barry's financial counselor, said the flap over aid to working poor families was typical of the council members' frustration in dealing with budgetary problems with limited resources.

"The executive branch has more staff resources and understanding of finances, which gives it an advantage," Dearborn said. "And it frustrates the legislative body because they want to do 'magic' too.

"Whenever the council wants to do something, the executive says that's fine, but we'll have to lay off social workers or do something equally unpleasant, and then the council gets mad because they're being given a lousy choice," said Dearborn, who is vice president of the Greater Washington Research Center.

City Council member Jerry A. Moore Jr. (R-At Large) has touched off a flurry of complaints from Washington saloon owners by proposing a 10 percent tax on gross revenues from increasingly popular pinball machines, jukeboxes and video games such as Space Invaders, Asteroids and PAC Man.

Moore considers his bill a potential fiscal jackpot for the cash-strapped city.

"This is a fast-growing industry that has really not been regulated or taxed at all," he explained.

But the idea doesn't thrill Stuart Long, owner of Duddington's and Jenkins Hill, popular Capitol Hill saloons.

"It's terrible," says Long. "Just what don't they tax anymore?"

Long said that the tax would hurt local bar business, which already is being buffeted by the recession.

"Those video games help pay the rent," he said.