Hard fantasy is concerned with how things work, and why. Fantasies can be meticulous about that in some areas while being completely casual in others.
I recommend Margaret Ball's Lost in Translation as hard fantasy. Magic flows through the ground and into plants. Clear too many plants, and the magic comes out as monsters. What follows is some nice world-building. Not being able to clear large areas has all sorts of implications. And the book has one of my favorite villains. He comes up with a "clever" way of working around his world's restrictions on magic, and in the middle of the havoc he's causing, he regrets that he can't publish his findings. Also, he has trouble understanding that the scary people he's dealing with will remember the promises he makes.
To my mind, the other pole of fantasy is dream logic, with the Alice books as the prime example. Dream logic needs little bits of rationality to ground it-- if Alice keeps growing, she won't fit in a house, and if she keeps shrinking, she's floundering in a pool of tears from when she was gigantic... but the size changes don't have to be connected to any large structural ideas.
Mieville's Perdido Street Station and Un Lun Dun are probably my favorite relatively recent dream logic fantasy, with the latter not nearly as famous as it deserves to be.
Any recommendations for hard and/or dream logic fantasy?
Link thanks to yhlee.