I remember there was a teenager who babysat two kids (I think) And they always went on magic adventures where she and the two kids turned into animals and those parts were animated while the rest was live action. I have no idea what it's called. All I really remember was one episode they turned into caterpillars.

Sounds like Secret Adventures:
TLC Entertainment

Here's a snippet that matches your description..

meet drea thomas, an average girl with a big imagination. drea babysits 2 kids named matt and rachel and with their imaginations they go on "secret Adventures" to solve their problems.they turn into cartoon animals and have strange perdicaments and along the way they learn important family values.

I found a 'part two' of an episode here:

Part 2: Secret Adventures Shrug - Self Worth Not Tied to Accomplishments - YouTube