Hah, you found my little letter burn feature! Currently, you can only smelt iron, emiril and copper into bars, 5 coal each.
2 ideas for ya:
1) Heating heated item makes it hot for longer (maybe until melting at some point)
2) If you put an item near anvil it "snaps/attaches" to it so you can combine more items in the craft (for setting gems in tools, or making combined recipes (1 ingot = pickaxe, 2 ingots = hammer (but hammer would have to be huge since more material is involved and be but behind back, not in the pocket or backpack)))