diff --git a/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/utils/workflow-canvas-helpers.ts b/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/utils/workflow-canvas-helpers.ts
index afcbc8034a8..d3b9e670c82 100644
--- a/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/utils/workflow-canvas-helpers.ts
+++ b/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/utils/workflow-canvas-helpers.ts
@@ -7,6 +7,22 @@ import type { BlockState } from '@/stores/workflows/workflow/types'
 
 export const SUBFLOW_DROP_TARGET_CLASS = 'subflow-node-drop-target'
 
+interface WorkflowCanvasInteractionPolicyInput {
+  embedded: boolean
+  canEdit: boolean
+}
+
+/** Separates position editing from structural re-parenting for embedded canvases. */
+export function getWorkflowCanvasInteractionPolicy({
+  embedded,
+  canEdit,
+}: WorkflowCanvasInteractionPolicyInput) {
+  return {
+    canDragNodes: canEdit,
+    canReparentNodes: canEdit && !embedded,
+  } as const
+}
+
 /**
  * Marks canvas nodes nested inside a subflow container. React Flow v11 emitted
  * `data-parent-node-id` for this; v12 emits no parent attribute, so the app
diff --git a/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/workflow.tsx b/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/workflow.tsx
index 7db19721b03..d330b7b5037 100644
--- a/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/workflow.tsx
+++ b/apps/sim/app/workspace/[workspaceId]/w/[workflowId]/workflow.tsx
@@ -102,6 +102,7 @@ import {
   getNodeDataDimension,
   getNodeSelectionContextId,
   getRunFromBlockDependencyState,
+  getWorkflowCanvasInteractionPolicy,
   getWorkflowLockToggleIds,
   isEdgeProtected,
   isInEditableElement,
@@ -749,6 +750,10 @@ const WorkflowContent = React.memo(
       }
       return userPermissions
     }, [userPermissions, currentWorkflow.isSnapshotView, workflowReadOnly])
+    const { canDragNodes, canReparentNodes } = getWorkflowCanvasInteractionPolicy({
+      embedded: embedded === true,
+      canEdit: effectivePermissions.canEdit === true,
+    })
     const {
       collaborativeBatchAddEdges,
       collaborativeBatchRemoveEdges,
@@ -2856,7 +2861,7 @@ const WorkflowContent = React.memo(
             className: block.data?.parentId ? SUBFLOW_CHILD_NODE_CLASS : undefined,
             extent: block.data?.extent || undefined,
             dragHandle: '.workflow-drag-handle',
-            draggable: !workflowReadOnly && !isWorkflowBlockProtected(block.id, blocks),
+            draggable: canDragNodes && !isWorkflowBlockProtected(block.id, blocks),
             zIndex: depth,
             data: {
               ...block.data,
@@ -2903,7 +2908,7 @@ const WorkflowContent = React.memo(
           parentId,
           className: parentId ? SUBFLOW_CHILD_NODE_CLASS : undefined,
           dragHandle,
-          draggable: !workflowReadOnly && !isWorkflowBlockProtected(block.id, blocks),
+          draggable: canDragNodes && !isWorkflowBlockProtected(block.id, blocks),
           zIndex: cardZIndex,
           extent: (() => {
             // Clamp children to subflow body (exclude header)
@@ -2957,6 +2962,7 @@ const WorkflowContent = React.memo(
       isDebugging,
       getBlockConfig,
       embedded,
+      canDragNodes,
       workflowReadOnly,
       collaborativeSetBlockErrorEnabled,
       collaborativeBatchRemoveEdges,
@@ -3658,7 +3664,7 @@ const WorkflowContent = React.memo(
         // paths bail when potentialParentId still equals the drag-start parent, so
         // positions persist but a block can never be inserted into (or pulled out
         // of) a loop/parallel from the embedded view.
-        if (embedded) return
+        if (!canReparentNodes) return
 
         // Check if this is a starter block - starter blocks should never be in containers
         const isStarterBlock = node.data?.type === 'starter'
@@ -3774,7 +3780,7 @@ const WorkflowContent = React.memo(
         getNodes,
         potentialParentId,
         blocks,
-        embedded,
+        canReparentNodes,
         getNodeAbsolutePosition,
         getNodeDepth,
         isDescendantOf,
@@ -5141,7 +5147,7 @@ const WorkflowContent = React.memo(
                   multiSelectionKeyCode={embedded ? null : ['Meta', 'Control', 'Shift']}
                   nodesConnectable={!embedded && effectivePermissions.canEdit}
                   connectOnClick={false}
-                  nodesDraggable={!embedded && effectivePermissions.canEdit}
+                  nodesDraggable={canDragNodes}
                   draggable={false}
                   noWheelClassName='allow-scroll'
                   edgesFocusable={!embedded}
@@ -5151,10 +5157,8 @@ const WorkflowContent = React.memo(
                     canvasOpacityClass,
                     isHandMode ? 'canvas-mode-hand' : 'canvas-mode-cursor'
                   )}
-                  onNodeDrag={effectivePermissions.canEdit ? onNodeDrag : undefined}
-                  onNodeDragStop={
-                    !embedded && effectivePermissions.canEdit ? onNodeDragStop : undefined
-                  }
+                  onNodeDrag={canDragNodes ? onNodeDrag : undefined}
+                  onNodeDragStop={canDragNodes ? onNodeDragStop : undefined}
                   onSelectionDragStart={
                     effectivePermissions.canEdit ? onSelectionDragStart : undefined
                   }
@@ -5162,9 +5166,7 @@ const WorkflowContent = React.memo(
                   onSelectionDragStop={
                     effectivePermissions.canEdit ? onSelectionDragStop : undefined
                   }
-                  onNodeDragStart={
-                    !embedded && effectivePermissions.canEdit ? onNodeDragStart : undefined
-                  }
+                  onNodeDragStart={canDragNodes ? onNodeDragStart : undefined}
                   snapToGrid={snapToGrid}
                   snapGrid={snapGrid}
                   elevateEdgesOnSelect={false}