I prepared a sample for you just for showing that dragging MultipleItems without copy works "out of the box" with Q3 2010 SP1 `s RadTreeView for WPF 3.5. The block of items you have selected cannot be moved into one of the SelectedItems or between them which is expected.
However, your scenario has different custom application logic. You will have to copy the Items you are dragging in order to drop them inside one of them or between them.The copy function is essential since the RadTreeView won't let a user to drag a parent item into one of its children or itself.
You will definitely need some checks related to the DropTarget ( RadTreeViewItem or RadTreeView) and DropPosition(Before, After, Inside). Additionally, the DragCue may need correction(in order to show that a D'N'D operation is possible). Feel free to ask if you need further assistance on this.
All the best,
the Telerik team