I'm going to assume you mean the little artwork window that use to be present in the lower left hand of iTunes. If so, yes it is gone.
The best way for me to add/drag artwork from my desktop is to enable Column Browser in the Songs view. You will have an Artist Column and Album column. Select the album you wish to add artwork to from the Album column and Get Info. Answer Yes to the question. Now you can drag the cover art into the artwork window. This will add it and embed the artwork with the file for every song in the album.
The best way for me to add/drag artwork from my desktop is to enable Column Browser in the Songs view. You will have an Artist Column and Album column. Select the album you wish to add artwork to from the Album column and Get Info. Answer Yes to the question. Now you can drag the cover art into the artwork window. This will add it and embed the artwork with the file for every song in the album.