You can say that the use of the term "transubstantiation" is anachronistically applied to Augustine. In a sense, this is true, since he himself never used the word. But it is not so much the anachronism you imagine. The concept is there in his phrasing, even if the doctrinal development needed to come up with the word "transubstantiation" would take many more years to come to light. Theologians of every denomination, even yours, I dare say, would be out of business if there were no such thing as doctrinal development. To me, making a fuss out of the word "transubstantiation" as a concept Augustine would use is something of a straw man. He knew the idea, even if he did not know the phraseology. To me, also, the passage you furnish does, on its own terms, say the same thing Catholics would say today.
It does no good, in the end, to argue about appearances when talking about the Catholic understanding of the Eucharist. Appearances are readily conceded. The "reality" of the situation, however, from the Catholic POV, can only be discerned by faith. It might not look like the Body and Blood of Christ, but it is, nonetheless.
Finally, another way to look at Augustine's quote is to consider it a kind of shorthand to keep things simple for those who already understand the actualities of the situation. That he continues to refer to the Eucharist as "bread and wine" means nothing. In fact, even today, Eucharistic Prayers 1 (the Roman Canon), 2 and 4 all refer to the Eucharist, already consecrated, as "bread" and "wine." It's just shorthand, to avoid long-winded, theologically precise formulas when everyone present is presumed to know what is on the altar. Check out the link to see what I mean: http://www.catholicliturgy.com/index.cfm/FuseAction/Text/Index/4/SubIndex/67/ContentIndex/22/Start/9
Last paragraph: “wine” should be “cup.” But the principle remains, as “bread” is used in each instance.