All I can say is what I see, and it drags and drops fine without any problems for me at all. I dragged and dropped to a new folder, it worked. I dragged and dropped it back to its original folder, and it worked.

I'm using the latest version of OS 2008, and the only app in the background is Skype.

EDIT: I've just tried it again and it still works absolutely fine for me, I can't reproduce any of the problems mentioned in posts above. The dragging and dropping worked fine when I dropped on the folder icon itself and when I dropped on the text next to the folder icon.

i think i also had to point to the folder instead of the text... but maybe i was just lucky that way

interesting. Thought mine was broken for days now. I use the new version of OS2008 on my N800. After reading this, I decided to play around with it and see if I could get it to work. Finally, it works.

Mine seems backwards from everyone else's. Mine only works if I drag the icon on the right, to the left column, so the folder is highlighted, but I CAN NOT drop it on the text or the folder on the left. It must be in the white area to the right of the text. Works perfectly every time. No applications open in the background. Not in full screen.

Strange, huh?

EDIT - scratch all that. It seems to actually be a invisible box that the item must be dropped in. It seems to be near the 6th character of the word in the left column. For example, in my category named "Games" the icon must be dropped at the end of the "s". Of the Category "My Selection", it only works near the "ec" of selection.

Make of that what you will.

To be honest, I've yet to find any consistency in how application icons are moved from one group to the next...each of the suggested solutions here have worked for different program icon groups...ie. I was able to move one program by dragging the application icon over the folder icon...nothing else would work; in a second scenario, I had to drag the application icon into the white space as suggested above; so far, in a third case what worked was a quick double-click and drag ontop of the group name???

As barqer says, "Make of it what you will"

Other than these strange little issues here and there, this little device is proving itself more and more awesome each day!

I had this problem for months and then completely solved it, for me.

You have to go to the organize spot, of course. Drag the icon you want to move to the category where you want it and quickly drop it JUST ACROSS THE MIDLINE, not near the folder icon.

Tried all these methodologies at some point and the only thing that seems to work is tireless repetition until it decides it is happy with wherever you drop it. On the folder sometimes works, on the text sometimes works and somewhere around where you want it sometimes works. All it takes is a lot of time and luck. Cursing seems to be optional .

Where I work we call that flaky behavior and fix it :-).