I don't understand, there appear to be 2 issues here, first you mention copy and drag and then talk about doing it one cell at a time with transpose, just for the record to use transpose
highlight all the required cells on sheet1 ie c3 to c10 select Copy
select cell D5 on sheet2 select Edit, pastspecial, check Transpose and click OK
D5 to K5 will now contain the data.
What have Formulas got to do with this?
If you want a Cell on Sheet2 to equal a cell on Sheet1 then =sheet1!c3 for example, does the trick.
Brian