Agree, I was surprised of the change myself. It makes it harder to interact with folders in explorer. When faced with setbacks like this, I try to take a step back and look at it from a different angle, and try to use what we still have available, to solve the issue at hand. Remember that there is more than one way to perform most actions. The only optional way I could see right now was to add an additional step and do this:
Let's say I browse to a folder in explorer and want to drag the folder in the address bar to the desktop, as a shortcut link. In the new Win11 Explorer, dragging from address bar is no longer available, so we can no longer do it this way... ☹️
So that option is not available to us any more.
So what we can still do is move up to the parent folder's contents by going up one folder (Alt+up-arrow).
By doing this, the "Source folder" we want to use is no longer in the address bar, but in the parent folders contents. Right drag the folder to the desktop(or other destination) and release. The context menu will pop-up, and we can now select the option we want to perform. In this case we are making a short-cut to the folder on the desktop, so we choose that.
Now we have our folder shortcut.
If you have two tabs open, you can also drag the folder in the first tab, to the other tab, and once it switches to it, you can drop it into that folder. Alternatively, you can open two explorer windows if desired, and drag between them.
I do agree that I used that feature a lot and wish they could add it back, but we make due with what we got. We did get some cool new features in explorer when they added tabs, but we also lost a few features a lot may use. I'm hoping they keep improving the UI and eventually add the option back in, but for now we have an alternative to do what we need to do and move forward.
Hope this helps a little....
Regards.