Like they said, you can't get above 100 by transmuting items, you have to craft adornments for skillups past 100.
Easiest thing I've found to do was to bring an AE class to caves, mentor a lvl 15 and blow shit up. Mobs are rather close to each other and a few blue AEs will usually get you at least 3-5 chests. Transmute all that crap then make adornments with it. Have fun, long way to 400, but you can do it all off T1 shit.
Or, if you want an even easier way..... switch to tinkering
