You need to select a file first.
Also, since it sounds like you have a mixed Library now (some ALAC already, some still FLAC), I would create a Smartlist of only FLAC files so that you don't end up with ALAC duplicates or waste your time re-encoding files.
1. In the left hand Tree, select Playlists. Then Add Smartlist (in the tab). Name it something simple (like All FLAC).
2. Click on Add New Rule. From the Drop Downs: 1) File Type 2) is 3) FLAC -> OK
You should now have a Smartlist that only shows your FLAC files. Click on any file in the Smartlist, Edit -> Select All.
Then Tools -> Library Tools -> Convert Format.
In the Convert Format Action Window (lower left), click on Options.
Under Destination, select Convert to same directory as original files.
If you want to get rid of the FLAC completely, select Mode -> Replace original file on disk and in library
Under Audio, I would leave Apply DSP unchecked and Bitdepth at Automatic.
Hit OK
Then click on the Convert button in the Convert Format Action Window.