Is the object created INGAME by the player or in the creator?
[quote:2tosx3bm]"Pick nearest" is a common condition.
You select the object type ("Grid" here I guess) and input the position you want to test (here mouse.x and mouse.y).
This will pick the nearest instance of the Grid object to your mouse cursor.
For drag/drop mechanics I suggest you to check the how do I FAQ, I think there are a few examples of drag/drop listed in there.
The "snap to grid" effect is achieved when you drop an object by spawning it in the middle of the current cell instead of the mouse position where it was droped.
It depends a great deal on how you setup your grid.