Note that unchecking zero all controllers is a per project setting. If you start a new project (unless using a template in which you have already unchecked it) or load a project that was previously saved with it checked, you will need to uncheck it and resave the project in order for it to stick.

Also make sure the edit filter on the track you're dragging from  is set to Clips and nothing else

Do you have an audio clip in a MIDI track?

Shouldn't make any difference - I can freely drag/copy midi or audio to any other track

rcalligan
Probably One of the dumbest Questions Ive every asked, but I used to hold shift key down and drag audio clips from one track to another track.  However now, clips will not will move from the track they were recorded on... it's like they are attached.  I cant even cut n paste them to another track..

 
I had the identical problem yesterday. i wanted to copy a number of bars from the beginning of a track to later. The ONLY thing that worked was copy & paste special.
 
I also appears that drag-copy (from track to track) does not include automation, or at least it was not obvious to me how to include automation.
 
Approach: I now use a "temp" track that I first copy-drag to, then move on the temp-track, and then copy-drag back. This, however, does not include automation.

Correct.
 
To include automation you must use Copy/Cut Special

To include automation with drag-copy, check:
Track View - Options - "Select Track Envelopes with Clips".
 
 

Tenfoot I think I owe you big time... I unchecked zero controllers and it "appears" to have resolved the issue.  I wanted to try it several times before saying for sure, but after a dozen or more takes putting on string tracks it never once did the weird volume thing after doing that. 
 
Thank you so much.... I have to admit I have no idea why that setting would default to being checked... not even sure what it is for, but glad it's gone... by the way none of the vendors including Cakewalk were able to resolve this issue.... thank you soooo much

Very glad you have it sorted!  
It is quite an old setting,  the point of which was to ensure that if you stop a project and restart it from a different location  you don't end up with controllers like sustain pedals,  modulation  etc stuck on.  Unfortunately with the myriad of different ways that vst plugins now utilise controllers it has become a bit of a liability.