Help: I'm unable to identify the issue with this drag and drop game (file included)

Lauren,

It is maybe not a well-known, but newly known bug (See Ashley's first Reply) in SL that using "State of XXX is ..." in the "When" portion of a trigger only works if you have fewer than five items in the conditions.Using "When state of XXX is ..."  seems like a wonderful idea, but more items than that, and it just doesn't work. It's a timing thing. (Note: this restriction doesn't apply if "State of ..." is used in the Conditions part of the trigger.)
You need to set the "When" clause of those triggers to fire based on an actual event (like "When timeline starts", or "When user clicks", or "When variable changes")

Check the Corrected Slide in the sample. I created a variable to tell when all drop targets have an item dropped on them. A trigger on each medal is fired when it is dropped on a rectangle, and changes the variable only when all the other rectangles have been dropped on. Then there is a trigger to show the layer when the variable changes iOne is dropped Incorrect.

Thank you, Walt. I couldn't have begun to figure this out without your help. We are nearly there, but there's still one issue-

The "You are a winner" message did not appear when all of the states were drop correct, only the retry button.

I adjusted the trigger for retry and the trigger for the line motion path. Now the message is showing up when all are correct, but I couldn't get the retry to not also show up when all are correct.

Your help is appreciated!

Hi Lauren and welcome to E-Learning Heroes :)

So close! 

You just needed to remove the additional condition of having 'AllDropped' equal to True since you already specified you want it to show when the variable changes:

Your updated file is attached.

Thank you both!