The "Cannot initialize Drop" SWT error is caused by the drag and drop API changes introduced by Eclipse 3.3. oXygen 7.2 was released before Eclipse 3.3 so it does not support these changes. This is why you have to use the oXygen 8.2 plugin for Eclipse 3.3
which is the first version that supports the changs introduced by Eclipse 3.3.
The same problem was reported here
(see the end of the thread).
PS: The person from the Eclipse team who tried to reproduce the bug (Duong) could not do that because he used an .xls file (probably an Excel stylesheet) instead of an .xsl one (an XSLT stylesheet).