Thanks Joe but that didn't work.  Anything else?  This is really bugging me especially since I have 2 other PC's and am able to do this simple task with no problems at all.  Add the fact that this is a new PC and there is my frustration.

Thanks for your trying to help & hopefully you will have another suggestion soon.

To be honest - I have no clue when it started.  The computer is only 1.5 months old and I don't remember ever trying to drag & drop before this.

I have gone back a few days with system restore but quit.  Any other ideas?

I hate the thought of reloading everything........

Try the Drag and Drop fix from:
http://www.aumha.org/regfiles.php

In case you need to reinstall:
http://support.dell.com/support/topics/global.aspx/support/kb/en/document?dn=1090151
The process is much faster than clean install.

If you don't want to loose your installed apps:
http://www.michaelstevenstech.com/XPrepairinstall.htm
Don't forget to save your data to external media.

I tried the fix but it didn't work.

I'm unsure about the reinstall.. what am I reinstalling?

Should I just keep going back on System restore to see if it ever worked?