все поправил target и перевалил
http://cyberua.16mb.com/drag&drop/ .
а проблему с высотой решил так
width_height:function( drop_elem){
var width_drop, height_drop, height, width, height_drag, width_drag;
if(action.auto){
drop_elem.style.height = "auto";
action.auto = "stop";
}
width_drop = drop_elem.offsetWidth;
height_drop = drop_elem.offsetHeight;
width_drag = drag.obj.offsetWidth + parseInt(getComputed(drag.obj).marginLeft);
width_drag += parseInt(getComputed(drag.obj).marginRight);
height_drag = drag.obj.offsetHeight + parseInt(getComputed(drag.obj).marginTop);
height_drag += parseInt(getComputed(drag.obj).marginBottom);
width = width_drop - width_drag * action.count;
height = height_drop - height_drag ;
if(width < width_drag && height < height_drag) action.auto = true;
}