I nearly have the solution thanks to this question: Draggable revert if outside this div and inside of other draggables (using both invalid and valid revert options)
I have amended the code in jsfiddle here http://jsfiddle.net/phoebebright/jcRN7/1/ to demonstrate what I want to do showing the outside div where items are droppable and an inside div where they are not, easier to demonstrate than to explain!
How can I stop a div being dropped on a div inside a div which is droppable?