This blog entry is dedicated to Making Gold with [Transmute: Living Elements].
In short, you purchase and/or farm 15 Volatile Life, take the Portal to Uldum, and use your daily cooldown of Transmute: Living Elements to transmute those 15 Volatile Life into 14-16 Volatile Air.
Now, in the actual skill, it says "Transforms the essence of life into another element. The exact result is not known ahead of time."
In reality, it has been discovered that the Element you get as an output is dependent solely on what zone you are in when you do the Transmute. The Cataclysm zones which are associated with an element go as follows:
Deepholm - Volatile Earth
Hyjal - Volatile Fire
Uldum - Volatile Air
Vashj'ir - Volatile Water
Furthermore, if you are a Transmute-Specced Alchemist, you have a chance to proc additional Elements on top of the 14-16 Volatile [Earth/Fire/Air/Water - zone-dependant] you decide to Transmute. Contrary to the actual Transmute: Living Elements, these procs are actually random. The zone that you're in has no effect whatsoever on the Elements that are procced on top of those designated by your character's location at the time of the Transmute.
Transmute: Living Elements shares the midnight-reset cooldown of Transmute: Truegold. Many of you may opt to use Transmute: Truegold on a daily basis - which may or may not be more profitable (server-dependant) - but it's worth noting that you cannot use both of them in the same day. They both share the same cooldown which resets daily at midnight server-time.
I hope this write-up has helped to add clarification; and, as always, good luck!