partial victory
I found below and was able to reinstall WMM except still cannot drag and drop.
Reinstalling Movie Maker 2.1...

Reinstalling Movie Maker

* Browse to C:\Windows\inf
* Right click on Moviemk.inf and select Install
* When it asks for your Windows XP cd put it in and browse to the i386
folder. If you've installed the set of backup files on your hard drive,
browse to c:\Windows\ServicePackFiles\i386
* Select moviemk.exe and click the Open butten
* the OK button will copy the files and finish the reinstall....