In the second and third Matrix, Agent Smith jabs his hand into a victim and a black gooey substance starts to spread around them and eventually morph them into one of Agent Smith's kind. I'm going to assume that was done through 3D. How would I go about achieving this liquid effect-morph style thing?
Here's what I'm talking about:
"It's all around us Neo, temporary constructs of time....."
In AE without using C4D or another 3d program to render the liquid mercury like transformation, you can use something like FreeForm Pro from Mettle to generate a similar surface. You can build a animated displacement map that approximates the shape of your subject to displace the surface in 3d space, then use the noise generator to animate the surface and create the watery/mercury flowing effect. A Reflection map and a animated texture will complete the process.
Below is an example of water done with FF Pro that can give you an idea of what the plugin can do if you're not already familiar with it.