Quote from SuperterryHere's an interesting idea: Some elemental units are made by combining two certain units. Like for instance, if you want to make a lightning unit, you have to have at least one fire unit and one air unit OUT OF BATTLE AND CLOSE TO EACH OTHER. Otherwise they may both get killed by enemy units durning the process, or not transform at all.
You cannot combine units in the garrison. Also it takes time for the two units to merge. If the transformation was instant, imagine how cheap it would be, especially when you plan a surprise for your opponent.
1) Combining is already similar except you don't have to make the units already.
2) That would be total imbalance. Early game teching to mid-game units would be a quick transition and doesn't punish for over-investing in early game units/not teching up.