Setup:
Xcode 4.3.1 (or 5.x)
OS X 10.7.3
I have reproduced this issue on two separate late-model Macs with this setup.
St
Be sure you don't have the project already open in another window. Xcode only lets you open a project one time. I've made this mistake a lot when working on a framework then trying to add it to an application.
Simply close the project you're trying to drag in's window and everything will be happy.