I just fixed a broken lcd I had setting around and decided to give multimonitor a try. After much frigging and reading the closest I ended up using twinview but it has the side effect of considering both monitors as one large monitor. I would set it up as two seperate screens but apparently you cannot drag from one monitor to the other which defeats the point.

What I want to do it have my main monitor (which is a higher resolution monitor) to be the primary monitor. The Desktop stays on this monitor, fullscreen only fullscreens to this monitor, programs like mplayer only play on this monitor, nothing ever opens on the second monitor unless I drag it there.

Can this be done? I know using window rules I can achieve this to a degree but not everything.

The X system fortunately does have a concept of a "primary" monitor, but only in the second setup you described (although the cursor should be able to cross over fine).

Can you check to see what the value is of "echo $DISPLAY" on each screen? It should be something like :0.0 and :0.1 respectively.

nope, it's :0 on both screens.

In this case, KDE cannot do much as X is seeing both monitors as part of the same screen. This is not a supported configuration.
The system needs to see each monitor as a separate screen.

Well correct me if I'm wrong (and I hope I am) that if I set it up as two different screens I can move the mouse between them but not drag applications? And I would have to start them with DISPLAY=:0.1 etc to load them on each respective screen?

The features I want seem to be split between the two ways of doing it (twinview/seperate screens).

If you open System Settings > Display & Monitor > Size & Orientation, are the two displays seen as two different screens?
If they are, is the correct screen selected as the "Primary Output"?