You can not get rid of the book; it goes into the quest item section of your inventory. Did you find the first book already, in the locked chest downstairs from the bedrooms? The key for that chest can be found upstairs.
That book contains the spell Amdusias used to turn into a dragon, and is the one the Librarian is looking for. Return it to the librarian to get the second volume (containing the counter-spell). Read the second book to cast the spell to turn Amdusias human, assuming you have the ingredients (which it will list).
