Cannot drag and drop composition in timeline

I had the same issue. For my part it seemed to be related to the AE window beeing my secondary screen connected to my laptop (Apple M3 Pro, Nov. 2023). When moving the window back to the primary display did fix the issue, though it did resolve it per say.

Did you figure this out? I'm having the same problem

AE will disallow nesting if the procedure creates a recursive loop. In your case, you have the comp, Pre-comp 1 already nested in the comp you want to now nest into Pre-comp 1. You will have to re-think what you are intending to do and create another hierarchy.

Impossible to say much without more specific info, simple as the project seems to be. Can you actually create a new layer in the comp itself like a solid, text or shape layer?

Mylenium