But what I thought it would do is convert every upload file dialog to one that supports drag-and-drop. So that I don't have to re-navigate folders to select the file to upload.
But instead what it does is upload the file to drag2up.appspot.com, and put a url link to that file in the input box you've dragged the file to.
Pretty good article at http://techcrunch.com/2010/12/29/drag2u/.
"permissions": ["* ://* /","tabs","contextMenus", "unlimitedStorage","notifications"]
The first one is permission to communicate with arbitrary servers in order to download URLs and upload files. Tabs is used to interact with OAuth-powered hosts better. The rest just leaves room for future additions (reuploading images from a context menu, storing a cache of uploaded files, notifications for completed uploads, etc.). It doesn't request for permission to access history, and I have no idea why the Chrome web store says that that's a required permission.