This is quite the departure in art style, I know, but I think these particular scenarios are more amusing (and less disturbing) if presented with simplistic generic characters who all look the same.
Basically, it's the "it works with stick figures" principle.
As for the suggestion itself, this is exactly the example I gave of what I wanted to mod into Skyrim that other people didn't get.
"Why would you want that? You can frenzy with illusion, and summon with conjuration. Why make an alteration spell that turns someone into a bear?"
BECAUSE IT'S AMAZING, THAT'S WHY.
Incidentally, a quirk of Skyrim is that temporarily transforming an NPC might result in what's technically a different NPC than the one you transformed.
This is because a generic bandit you encounter will have been randomly generated via a leveled list. If you hit them with something that temporarily turns them into something else, they're actually replaced by that other thing. They then respawn to turn back to normal.
Since respawning triggers the random bandit selection again, they're more likely to be a different bandit with different gear than the bandit you actually transformed.
Which, from the player's perspective, would just appear to be transforming them twice.
ANOTHER quirk is that some NPCs simply will not temporarily go away, and the thing they're meant to "become" will still appear. In my experience trying to make nifty spells, I discovered this was true of town guards. Try to turn one into a chicken, you'll have done nothing to the town guard, and effectively just make a chicken appear for a bit.