I got the transmutation spell and then picked up two silver ingots. I have them in my inventory. When I put the green transmutation spell in one of my hands and click on it I get the message that I don't have any ingots to transmute. Can you explain or tell me what I should be doing?

you need iron ore or silver ore not ingots. If starting with iron ore one casting of the spell changes one iron ore to one silver ore. Second casting of the spell changes the silver ore to one gold ore.

Only works on ore, but clumsy to use if you want to stop at silver and not gold. You have to drop a silver ore after each transmutation then pick them all up.