Your code is riddled with errors. Since you put using namespace std; at the top, you don't need using std::cout or using std::endl. You don't properly allocate space for the string. The main loop is converting all of the character to uppercase, and the if statement at the bottom is doing nothing.
Code:
#include <iostream>
#include <cctype>
#include <string>
#include <algorithm>
using namespace std;
int main()
{
string s;
int lower = 0, upper = 0;
char c;
cout << "enter string: ";
cin >> s;
for (string::iterator i = s.begin(); i != s.end(); ++i)
{
if (islower(*i)) ++lower;
else if (isupper(*i)) ++upper;
}
cout << "upper: " << upper << '\n';
cout << "lower: " << lower << '\n';
cout << "convert to upper or lower case (u/l)? ";
cin >> c;
if (c == 'l' || c == 'L')
transform(s.begin(), s.end(), s.begin(), tolower);
else if (c == 'u' || c == 'U')
transform(s.begin(), s.end(), s.begin(), toupper);
cout << s;
return 0;
}