Manage Widget Page not working after move/upgrade

Just upgraded to 2.3 in Yhoo small business (and Thank You Forum for Wonderful Posts.) I then imported a blog and theme from another site where I was developing. Now, everything works except the widgets manager, the sidebar 1 says “Default Sidebar,Your … sidebar.” message, the widgets area below looks normal, but nothing happens when I try to drag, they are simply highlighted like text. I trying switching themes, thinking maybe the theme I was using was incompatably with 2.3, but, same result with Default. I tried manually replacing everything in the plugin folder with the content direnctly from my old (GoDaddy Hosted) site,same results.
Any input from this wonderful resource?
Thanks, Reese