You have a couple of issues.
First, you should download the ClipSpy tool which will show you exactly what Formats are getting drag/dropped or copy/pasted. You will find that image SRC urls are stored in the UniformResourceLocatorW format, and there are various other formats available as well, including CF_HDROP which points to a local copy of the image file.
Secondly, you will find that the Drag/Drop doesn't work properly from Protected Mode IE on Vista and Windows 7 due to security restrictions. To enable drag/drop to your application, you must list your application in the registry.
You can register your application to accept web content from a drag-and-drop operation by creating a DragDrop policy. DragDrop policies must have a globally unique identifier (GUID) associated with them. Use CreateGuid to create a new GUID for your policy. Next, add a key to the following location.
HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Internet Explorer\Low Rights\DragDrop
Set the name of the new key to the GUID created for your policy and then add the following settings to the key.
- Policy (DWORD) should be set to 3, which tells Protected Mode to allow web content to be silently copied to your application process.
- AppName (REG_SZ) is the filename of your application executable file.
- AppPath (REG_SZ) is the user-selected install location of your application's executable file.