Ahhh yet something quite different than I expected. I had a different guess. In Aion, for example, you could transmog a leather armor into another leather armor, but you couldn't do any dyeing afterwards.... Good thing I asked.
Then I decide for number 4 (and hopefully we can still dye afterwards), because I consider e.g. the Sword of Justice as a unique artifact that was intended to be a sword and not an axe / mace / dagger... That would be too blatant an act for me because of the immersion. This should be reserved for in-game mechanics, if available, e.g. via alteration magic.
https://baldursgate.fandom.com/wiki/Staff_Macehttps://baldursgate.fandom.com/wiki/Staff_SpearSo transmog in a limited way is okay for me.