Even if the clips are not touching, you can still apply a fade, it just results in a post or prefix fade depending on applied clip. When you say does not take, does the dragging transition just disappear and you are left with the hand cursor? A locked track will create that, if so, use the small padlock to the left of the track to unlock.
The interface used to give you the red circle with cross line, the basic "no symbol" through it which at least was helpful, I guess that was improved and now the transition just vanishes.
Jeff