Haha, that's pretty much what worm castings are -- fertilizer (worm poop) mixed with pieces of compost/wood/soil, etc. And they're definitely too hot for young seedlings, at least when being used alone (and nothing to aerate the soil). The castings themselves basically turn to a viscous sludge when wet, and are a terrible environment for roots by themselves.

If those cups have been transplanted recently into the pots, and I mean very recently (1-2 days), you can probably still take them out of the holes they're sitting in and mix in some perlite with the soil. (I'd make it at least a 4:1 ratio of soil/perlite.) You can get bags of perlite at Home Depot for just a couple of bucks. Also, get yourself a pH tester soon, and find out the pH of the water in your home. Bottled water isn't going to provide secondary elements that you would normally find in tap water, and isn't usually necessary. Also, if your soil mix has peat in it, you'll definitely want to keep an eye on the pH of your soil runoff, as peat has the tendency to make conditions too acidic. Check eBay, Craigslist, etc., for good quality digital pH testers, or you can probably find the liquid/strip test kits at Home Depot or Walmart in the pool maintenance and aqarium departments.

I'll keep my fingers crossed for your current seedlings, but they look pretty badly burned. Worst case scenario you'll have a better idea of what you should do next time. :thumbsup:

These are immensely helpful as well, if you haven't checked them out already: FAQs