I'll safely go with a direct quote from rothfuss which i assume to be close enough to the truth. 12-16-2019 on twitch:
Alchemy is a process of extracting like platonic forms from objects. So you can pull the drunkenness from wine, and have it, and put it in something else. Or you could just take the wine and pull the hangover out of it.
We know very little about Alchemy at this point in the story, because young kvothe knows next to nothing about it either. Simmon actually makes him say it. TMWF:31:241
“Okay,” Sim said, exasperated. “You need to shut up and listen. This is alchemy. You know nothing about alchemy.” I made a placating gesture. “I know. I know.” “Say it, then. Say, ‘I know nothing about alchemy.’ ” I glowered at him.
When kvothe gets exposed to Plum Bob we get a glimpse of how it can be used, as kvothe seems to lose all foresight and empathy. WMF:7:72
“How about this?” Simmon asked me. “Which is worse, stealing a pie or killing Ambrose?” I gave it a moment’s hard thought. “A meat pie, or a fruit pie?” “Wow,” Fela said breathlessly.
So Alchemy can alter your state of mind. This is just an example though, it hardly gives us an idea of the scope or how its done. Well we have two more sources. First, apparently, in a rare mood, Rothfuss himself chimed in according to this comment:
Alchemy is a process of extracting like platonic forms from objects. So you can pull the drunkenness from wine, and have it, and put it in something else. Or you could just take the wine and pull the hangover out of it.
Platonic forms is likely a reference to an idea put form by Plato that idealizations really exist.
The Platonic Forms, according to Plato, are just ideas of things that actually exist. They represent what each individual thing is supposed to be like in order for it to be that specific thing.
Finding out which view of philosophy Rothfuss had in mind, and then applying it the series, would be a good way to end up crocked. It seems Alchemy lets you extract how something makes people feel (litterly and physically) from an object. So you might be able to extract a bit of sadness form an a overcooked steak. But you could probably extract a lot of anger from idk Hitlers hat, because so many people there energy at it.
Finally, Auri does alchemy, but sense the Alchemy she does is part of the main theory were going to ave it tell the end.
