I spent a while trying to get to the solution for a problem I had trying to bulk convert mp3 to audiobook in iTunes from the Option drop-down menu. I could convert individually but when trying as a ctrl-a bulk select, the drop-down was stuck on “music” as my only option.
The solution for me was pretty straightforward. Prior to adding the files to the iTunes library, ensure that you have “Copy files to iTunes media folder…” checked.
Now when you go to convert the mp3 files to audiobook, the drop-down menu has all the options.