i know the wool is now broken so if you put the wool into your backpack it is then useless. You cant use it on the spinning wheel or you cant drop it. I had to call a gm to make it go poof out of my backpack. (lost around 20,000 white silk cloth this way)
lucky i had already done years ago a few 1000,s of cloth.
i would try 1 ball of yarn from the ground (of your house) and if it says you have to hold it then perhaps try 1 ball from your backpack.
Lorddog