He had turned into a dragon while he was asleep. Sleeping on a dragon's hoard with greedy, dragonish thoughts in his heart, he had become a dragon himself. (6.32)
Transformations in Narnia usually consist of the outside of something suddenly looking like the inside. Because Eustace behaves like a cold-blooded monster, he becomes a terrifying reptile. Consequently, we can guess that, in order to turn back into a boy, he'll have to start acting more human.
In spite of the pain, his first feeling was one of relief. There was nothing to be afraid of any more. He was a terror himself now and nothing in the world but a knight (and not all of those) would dare to attack him. He could get even with Caspian and Edmund now....
But the moment he thought this he realised that he didn't want to. He wanted to be friends. He wanted to get back among humans and talk and laugh and share things. He realised that he was a monster cut off from the whole human race. An appalling loneliness came over him. He began to see the others had not really been fiends at all. He began to wonder if he himself had always been such a nice person as he had always supposed. (6.34-35)
Becoming a dragon gives Eustace the ability to see himself for who he really is: an unpleasant, selfish person who is a burden and blight to everyone around him. Once he recognizes this, he is better able to understand his companions and their motivations.
It was, however, clear to everyone that Eustace's character had been rather improved by becoming a dragon. He was anxious to help. (7.14)
Making Eustace's appearance match his behavior encourages him to change that behavior right away.
"So I started scratching myself and my scales began coming off all over the place. And then I scratched a little deeper and, instead of just scales coming off here and there, my whole skin started peeling off beautifully, like it does after an illness, or as if I was a banana. In a minute or two I just stepped out of it. I could see it lying there beside me, looking rather nasty. It was a most lovely feeling." (7.38)
Eustace's transformation into a dragon is instantaneous (we assume) and occurs almost painlessly while he sleeps. The only pain is caused by the bracelet stuck on his arm when it turns into a thick dragon foreleg. But his transformation from a dragon back into a boy is a much more difficult, painful, and messy process.
"Then the lion said – but I don't know if it spoke – You will have to let me undress you. I was afraid of his claws, I can tell you, but I was pretty nearly desperate now. So I just lay flat down on my back to let him do it.
"The very first tear he made was so deep and I thought it had gone right into my heart. And when he began pulling the skin off, it hurt worse than anything I've ever felt. The only thing that made me able to bear it was just the pleasure of feeling the stuff peel off. You know – if you've ever picked the scab of a sore place. It hurts like billy-oh but it is such fun to see it coming away." (7.41-42)
Eustace was able to make himself hard-hearted and selfish, but he's not able to strip away his outer "shell" and get back to his true nature on his own. For that he needs Aslan's help.
"And there was I as smooth and soft as a peeled switch and smaller than I had been. Then he caught hold of me – I didn't like that much for I was very tender underneath now that I'd no skin on – and threw me into the water. It smarted like anything but only for a moment. After that it became perfectly delicious and as soon as I started swimming and splashing I found that all the pain had gone from my arm. And then I saw why. I'd turned into a boy again." (7.44)
Aslan seals Eustace's transformation from a dragon back into a boy with a baptism-like dunking in a miraculous pool.
It would be nice, and fairly nearly true, to say that "from that time forth Eustace was a different boy." To be strictly accurate, he began to be a different boy. He had relapses. There were still many days when he could be very tiresome. But most of those I shall not notice. The cure had begun. (7.61)
The narrator doesn't ask us to believe that Eustace changed overnight – he makes it clear that personal transformation is a gradual process that happens in fits and starts.
"That water turns things into gold. It turned the spear into gold, that's why it got so heavy. And it was just lapping against my feet (it's a good thing I wasn't barefoot) and it turned the toe-caps into gold. And that poor fellow on the bottom – well, you see." (8.71)
Perhaps what makes the gold on Goldwater Island more appealing than regular deposits of gold in mines is that it's so easy to obtain. Anything can turn to gold, instantly, without any apparent price or sacrifice.
"The king who owned this island," said Caspian slowly, and his face flushed as he spoke, "would soon be the richest of all kings of the world. I claim this land for ever as a Narnian possession. It shall be called Goldwater Island. And I bind all of you to secrecy. No one must know of this. Not even Drinian – on pain of death, do you hear?"
"Who are you talking to?" said Edmund. "I'm no subject of yours. If anything it's the other way round. I am one of the four ancient sovereigns of Narnia and you are under allegiance to the High King my brother."
"So it has come to that, King Edmund, has it?" said Caspian, laying his hand on his sword-hilt. (8.78-80)
The Midas-like transformation of everything into gold on Goldwater Island also causes another, more sinister transformation: Caspian and Edmund are almost instantaneously turned into greedy enemies.
"And we thought we'd rather be invisible than go on being as ugly as all that." (9.54)
We suspect that what the Dufflepuds really didn't like about the way Coriarkin transformed them into Monopods is that they didn't have any control over the process. They counteract their feeling of powerlessness by working a spell of their own.
She saw herself throned on high at a great tournament in Calormen and all the kings of the world fought because of her beauty. After that it turned from tournaments to real wars, and all Narnia and Archenland, Telmar and Calormen, Galma and Terebinthia, were laid waste with the fury of the kings and dukes and great lords who fought for her favour. Then it changed and Lucy, still beautiful beyond the lot of mortals, was back in England. And Susan (who had always been the beauty of the family) came home from America. The Susan in the picture looked exactly like the real Susan only plainer and with a nasty expression. And Susan was jealous of the dazzling beauty of Lucy, but that didn't matter a bit because no one cared anything about Susan now. (10.20)
Lucy is tempted to transform herself into an incredible beauty, even more striking than her sister, Susan. But this is a transformation that she senses just isn't appropriate for her. The narrator hints that, if she focuses only on making herself desirable, then whole nations will be torn apart by that desire. (Remember Helen of Troy whose beauty caused the Trojan War?)
"You see, it's only they who think they were so nice to look at before. They say they've been uglified, but that isn't what I called it. Many people might say the change was for the better." (11.21)
Coriarkin suggests that the Duffers don't know what's good for them. Although they've been very resistant to the change, perhaps they are actually better off as Monopods. Maybe each of us has gone through personal changes that we resisted at first, only to learn that we were better off in the end.
"In the world from which my friends come . . . they have a story of a prince or a king coming to a castle where all the people lay in an enchanted sleep. In that story he could not dissolve the enchantment until he had kissed the princess."
"But here," said the girl, "it is different. Here he cannot kiss the princess til he has dissolved the enchantment." (13.74-75)
The disenchanting of the lords is linked to Caspian finding a queen – but not in quite the way he hoped it would be!
And one by one everybody on board drank. And for a long time they were all silent. They felt almost too well and strong to bear it; and presently they began to notice another result. As I have said before, there had been too much light ever since they left the island of Ramandu – the sun too large (though not too hot), the sea too bright, the air too shining. Now, the light grew no less – if anything, it increased – but they could bear it. They could look straight up at the sun without blinking. They could see more light than they had ever seen before. And the deck and the sail and their own faces and bodies became brighter and brighter and every rope shone. (15.47)
The miraculous sweet water at the eastern edge of the world of Narnia transforms the crew of the Dawn Treader, making them more able to bear the natural and spiritual glories they encounter.