Well, it might be balanced even if you use it within meteorite range, depending on its cost and duration. And how strong critters are against each other. Keep in mind that morphing into a critter might even make you weaker, simply because you can no longer use a grapple/slingbow.
That’s an interesting idea too! But there is already Calming Brew for that purpose.
I another game I’ve played, when you use an item similar to this other players can attack and loot you, even outside of PVP areas. It’s system generated loot so similar to what a natural mob would drop.