Hi cliff,
It looks like you have found a bug, so I'm really sorry for the inconvenience. We are working on getting a fix out right now. In the meantime, there is a fairly easy workaround for the problem which is to use the right click menu. Select the songs you want to move, right click and click "Add selected tracks to playlist...".
I expect that we should have the new fix in place in the couple of days and drag and drop will be working correctly.
Regards,
Ben