Hey guys I just got this form from the main quest, but my problem is that I have no spells equiped in either hand when in "hover" form.

I can only land and attack with claws etc, but I'm pretty sure I should have a drain and raise dead spell equiped? I cant even access them from the faves menu, is this a bug anyone else is experiencing?

Works fine for me, more than fine. As far as I know the 2 spells should auto equip as in combat mode while hoovering. So I don't think you can manually equip them.