It could work out, but I'm just stating the fact that there hasn't been really any game that has used this touch screen right yet (except Yoshi Touch & Go). Mario 64 tried to use it to replace the analog stick. Castlevania has some spell casting tacked on. Metroid Hunters vanished into the abyss of space when it became obvious it needed another year of developement.
I don't know how the touch screen can work for a 2d Zelda. With a 3d Zelda it could make for gimicky musical spells.
Edit: You could use a series of drawings to create elemental effects. Imagine there are four simple graphics for fire, ice, water, and earth. You draw exactly where you want them in order to clear paths, make bridges, search for secrets, kill stuff, etc.