I just tested this, and it worked on all files. For files without an association, windows even popped up with the usual thing asking what I wanted to open the file with.

LabelOnDrop "%[droppath]%"

This also worked fine, too:

LabelOnDrop !execute [!alert "Executing %[droppath]%"]["%[droppath]%"]

Maybe you forgot quotes?

(Tested with the following: .ini, .txt, .png, .chm, .exe, and an couple unassociated files.)

Maybe I didn't get what you meant?