Spoiler Warning for Alchemy of Souls
Purpose:
While I thought Alchemy of Souls Part 1 was excellent, Part 2 suffered for a myriad of reasons. Below, I'll try to rewrite the major story beats of Part 2 in order to fix its biggest issues, while also preserving what worked from the original Part 2. These will just be ideas, instead of a fully fleshed-out, line-by-line dialogue rewrite.
What didn't work:
Cho Yeong / Naksu / Mu-deok / Jin Bu-yeon (FL) didn't work in Part 2. Not only did the new actress not have the same kind of chemistry with Jang Uk (ML), but the fact that she gets amnesia, and almost everyone else thinks the FL is dead undoes a lot of the tension that Part 1 Episode 20 established.
One of the main themes of the show is soul-transfer. But in Part 2, this theme is somewhat sidelined for the less interesting who really is Jin Bu-yeon question.
No one really questioned why FL went on the rampage in the original show. It was just accepted that she probably did it to avenge her father until the very end, when a few characters learn that she was controlled. This should have been a central question of Part 2.
Spoiler Warning for Alchemy of Souls
Part 1, Episode 18:
Everything occurs as in the original story, except FL and ML need to cooperate to disperse the Ice Stone barrier. In doing so, each unknowingly absorbs half of the Ice Stone's energy, and it mixes with their cores of energy.
Part 1, Episode 20:
Jin Mu does not simply possess rampage-inducing bells from Shaman Choi. Instead, her bells are only a copy of a dangerous, sorcerous artifact stored at Jinyowon, the Soul Chains. With the current copies, Jin Mu is only able to control FL for a short time before she will petrify and die, like her father. For that purpose, Jin Mu's main objective is not to kill Jin U-tak, but instead to break into Jinyowon and take the Soul Chains.
Due to this, FL's mind-controlled rampage is more extreme. Not only does she kill Jin U-tak exactly as it occurs in the show, but the Jinyowon break-in scene from Part 2 occurs now. Jin Ho-gyeong and Maidservant Kim are killed as Park Jin is forced to collapse the door. Jinyowon was built around the Soul Chains instead of around the Fire Bird.
ML dies, but is not immediately resurrected. Part 1 ends with ML still dead.
With the Soul Chains in his possession, Jin Mu does not dispose of FL. Instead, he is able to indefinitely and fully control FL's soul.
Part 2
Episodes 1-5:
ML is resurrected, thanks to the powers of the Ice Stone and King's Star. However, the audience learns that there was more time in-between his death and resurrection. Seo Yul's inaction despite knowing FL's true identity landed him in jail. Park Dang-gu's hesitance to kill FL results in Jin Cho-yeon hating him. As the leaders of their respective factions, Songrim and Jinyowon are entirely estranged. Jin Cho-yeon also requires aid from other families in order to return lost socerous artifacts to a new vault. Master Lee Cheol has disappeared and so faces no repurcussions.
All of the main characters also know Jin Mu is a villain, and no one openly sides with him. He hides in the mountains, weakening from his heavy use of the Soul Chains. While there, he commands FL to train and grow his shadow cabal army.
ML is very powerful, brooding, and estranged from everyone, as in the original Part 2. Not only is he hunting down soul shifters, however- he is also searching for the reason why FL killed him.
Park Jin resignes as Gwanju of Songrim out of grief, yet harshly tutors Park Dang-gu to put objectivity before his former relationship, and try to keep Daeho from splitting into factions due to Jin Cho-yeon.
ML breaks Seo Yul out of prison in order to get him to help figure out why FL acted as she did. Together, they raid the forbidden archives of Jeongjingak in search of what souls are and how they are controlled.
Episodes 5-10:
Jin Mu, ever weakening, hopes to gain an Ice Stone to stay alive and grow in power. It is explained that he fears soul shifting himself, as shifted souls are much easier to control, as they have unbonded with their original bodies. This is also why he did not shift souls in Part 1.
ML and FL have a dramatic confrontation, as ML tries to stop FL from growing the shadow cabal army. Both are gravely wounded, and FL snaps out of the Soul Chains's control thanks to Seo Yul and ML's research. Dying and ostracized from most of the world, she returns to Jin Mu and pretends to still be controlled so that he heals her. Jin Mu, weakened, doesn't notice and heals her.
Jin Mu's shadow cabal has already infiltrated many of the major families in Daeho, similarly to the original story. He manages to indirectly ally with Jin Cho-yeon's faction.
ML tries to sabotage Jin Mu's shadow cabal from the inside. Jin Mu finds the Fire Bird, which has escaped. His plan is to use it to summon another Ice Stone, similarly to the original plot.
The final confrontation is between Park Dang-gu's faction, which is on the verge of crumbling and deserting to Jin Cho-yeon's, who are all controlled by Jin Mu. However, Park Dang-gu and Jin Cho-yeon's love overcomes their "objectivity", and they team up at the last second. But it's too late. Jin Mu summons the Fire Bird, drying up the lake and gaining the Ice Stone. Jin Mu then reveals his shadow cabal army. And with his Ice Stone and the Soul Chains, he's able to control all of the soul shifters within Jin Cho-yeon's faction.
Jin Mu finds out about FL's sabotage, but the damage is done. He almost kills her, but she escapes in the fighting and tries to find ML. However, ML is preoccupied trying to learn more about souls and convince Park Dang-gu that Jin Cho-yeon's faction is not the threat. So she tells Seo Yul instead, who is in the middle of the fighting. Seo Yul initially is shocked that FL is good again, but is able to understand.
Seo Yul converges with ML and FL, both with full powers of half an Ice Stone, and they fight against Jin Mu's forces. ML has figured out the true nature of souls, and thus everyone knows how to resist the Soul 're able to resist his powers and overcome him together.