You have seedlings right, they are small? Why are you transplanting? Transplanting causes stress, if they are already stressed and you xplant they will more than likely die Transplanting seedlings is not recommended, how small are they? (pics)
IF you HAVE to I would slip them out of their current container in to a larger pot with a place the size of the current root ball hollowed out.
What exactly was the soil? You said MG but what kind potting, garden, organic? What have you added / done so far? Please give a detailed list.
Stop doing things for now until I have a complete picture. You can definitely over water, you should be watering by the hefting method.
**DON'T DO THIS NOW**
Hefting Method:
This means scratch up the first couple inches of soil, then water the pot a little let is soak in, do that again and again until about 10-30% of the total watering volume has run through, so for example if you gave the plant 1 gallon of water somewhere between a half a quart and a little more than a quart should have run through. Once you completed the watering, LIFT THE POT! Remember mentally the weight.
Now the important part of watering. WAIT UNTIL THE POT IS LIGHT. Then repeat the above procedure. If your plant droops you let it get too dry. You can also judge by scratching the first two inches of soil and feeling the wetness, but sometimes the top will dry out before the bottom - so hefting is the most accurate method.