With KReporter 4.2 you will need KREST 2.5.3.
uninstall KREST 2.2 , download KREST 2.5.3 from http://www.spicecrm.io/download/krest-core-2-5-3/ and install.
Regarding dragging, please check this thread KReporter 4.2.0 - Issue with drag'n drop for the workaround.
Val