Added movie, format: m4v, inserted short video clip also m4v, highlighted short clip and tried to drag it to a specific spot in the main movie, it will not go. I have iMovie version 10.0.8
First I think you have posted to the wrong spot - this should be in the Mac Apps section.
You can only place clips one after the other, you can't just drag to a specific spot if it is in the middle of another clip - so you either have to split the one clip you are trying get the short one in between, or shorten/lengthen the other clips around until you can the the short clip where you want it.
You should be able to split the longer clip easily by using a two-finger click to get a context menu and then choosing split IIRC.