Final answer:
The item in question is the D20, which re-rolls all pickup consumables into another random kind of pickup. It's unlocked by beating the Chest with Isaac and allows players to recycle items for potentially better ones.
Step-by-step explanation:
The item that re-rolls all pickup consumables in the current room into another random kind of pickup, including hearts, bombs, keys, coins, pills, tarot cards, chests, and trinkets, and is unlocked by beating the Chest with Isaac is the D20. The D20 is a die in the game which, upon use, transforms existing consumables in the room into different random items or pickups. This can be highly strategic, allowing players to essentially recycle unwanted or unnecessary items in the hope of more useful ones, making it an important tool for advancing in the game.