I upgraded xserver and xf86-input-{evdev,mouse,synaptics} to the latest git/masters a few weeks ago (and yesterday as well). Drag and dropping no longer works, either between windows or within the same window. On the other hand copy/paste does work in apps that support it explicitly.
Not much info here, and it's a year old. I'm sure you figure out a fix by now, and if not, please reopen with additional information.
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