Here is a scene that roughly does the morph. I tried to create a thing like a hand... the skinny fingers create challenges.
https://www.dropbox.com/s/o0pdgzk1b9the96/aero_morph4.ma?dl=0
https://www.dropbox.com/s/svvwfz4ojwzqxz2/aero_morph4.mp4?dl=0
The graph is as follows:

The mask is set to mask so that there is no effect inside the hand. I made the mask min/max distance slightly negative which pushes the mask inward a little and allows me to use a larger detail size.
The mask controls two effects... one is a subtraction of density each step( the modify_influence). I could have used a dissipate node instead of the modify, but subtracting has a stronger effect on thin density but less of an effect on heavy density... the idea is to slowly eat up the fuzzy fringes. The mask keeps it from eating the density inside the hand. This allows one to be less careful with the amount of density emitted.
The other effect is the attraction, and the mask keeps it from applying attraction inside the hand, which I found tended to cause a slight bias that pulled density out of the fingers. The attraction is along the level set gradient so even inside it pushes inward. The incompressibility of the liquid keeps things from collapsing.
There is a lot of drag on the attract_repulse which allows it to settle faster. I added a little extra drag as a separate influence( not affected by the mask) that then adds drag inside the hand, and keeps the density from swirling around inside it a bit. The motion inside the hand can bring density near the boundary where the modifier tends to kill it.
One needs to emit a slightly smaller volume of density than the volume of the hand because the fluid diffuses over time...especially if there is turbulence or if you have vorticity. However with the modifier that subtracts density one can emit more slop and have it still work. (the mask on dissipation was Michael's idea)
Simulations with a smaller voxel size will have less diffusion and be able to fit inside more cleanly with less reliance on the masked density subtraction.
Duncan Brinsmead
Senior Principal Developer