I was getting various results, depending on whether I held the icon long enough for it to start wiggling or not. If I waited for the wiggle pressing the home button would just cancel the wiggle, if not I would jump to the 1st home screen, one time dragging the icon there.
After several trials, my Touch sort of locked up. I got the 'rotating clock' wheel (the boot up or 'working' animation) over my screen, and after a little while my Touch showed the passcode screen. Entered the passcode, and all is normal.
Have made that happen twice now. Both times the Touch recovered on its own. Haven't had an unrecoverable crash that required a reset.