This is a general problem for java applets on the Mac. As a Mac user myself I find it really annoying, especially since drag and drop to java applets used to work fine until earlier this year. It's not confined to Lion, Snow Leopard has the same problem. It all started with one of the Firefox releases and then spread to Safari, Chrome and Opera. A little googling will reveal a lot of people who are non too happy with it but I haven't found anyone who seems to really understand the reason for it.
I'm hoping that somebody – Apple/Sun/Mozilla or whoever – will fix it soon. Meanwhile, I find the easiest workaround is to use copy and paste – see the entry in the svManager FAQ.
And if anyone knows of a really rock-solid, commercially-available, user-friendly, drag-and-drop, well-supported, works-anywhere, image-resizing, multi-file, non-java uploader then let me know. I keep looking but I haven't found it yet.
SimpleViewer Support Team.