I am running VWD2 on a Windows system. 

The manipulation features, pull and thug, do not seem to work for me. Do I first need to enable this somehow? 

Got it! VWD calls it 'dynamic deformation' and I need to press 'shift' while pulling.

However the cloth does not, or just very slowly, return to its original state.

Original position was maybe was not the right word. Sorry about that. I simply want the cloth to drape again and not remain 'nailed' in space. Basically I want it to behave like in Marvelous Designer. That if you yank a corner of the cloth, it behaves like a cloth does if a corner is yanked.  

Okay, I understand what you mean.
Normally, the point or set of vertices that are snapped with the mouse and shift key are released when you release the mouse.
There is a setting that allows you to keep these vertices snapped in space, but this is not the default mode.
If, by mistake, some vertices remain snapped in space, you can always select them, remove the "Fixed Points" mode and restart the simulation normally or with the shift key.

Gotcha! The static simulation stopped when I had completed the thugging. Restarting the sim did what I expected to see. 

When you are in the simulation tab, the shift key activates the simulation.
You can activate the dynamic deformation by moving on the garment. The selection can be a single vertex or by a sphere containing the vertices included in this sphere.
You can move the vertices in a plane parallel to the screen or on a line perpendicular to the screen by pressing the control key (with the shift key).
When the program switches to "dynamic deformation" mode, inertia is unchecked because mouse movements could generate too much energy if inertia was active.
When you release the mouse and continue to press the shift key, the simulation continues without inertia but you can reactivate it by clicking on the inertia box.
If you release the shift key, the simulation stops but you can restart it by clicking on the "static simulation" button.

Thanks. I begin to understand now. The 'dynamic deformation' a mouse action brings would be seen as a displacement within one frame and hence suggest huge velocity. With 'inertia' unchecked, the velocity is reset to 0.0 at each iteration, to avoid the huge energy that would follow from such velocity disturbs the system.  With 'inertia' off a vertex cannot build up velocity so, to the eye of the user, the simulation is slowed down. In this mode you would not be able to 'throw' anything because it would be falling down dead (at constant speed) . Also pendulum motions would not be possible because no kinetic energy is accumulated.

Would it be an option to have this not as a complete switch-off but as a transition? First of all put a limit to velocity and restoring the effect of velocity in a number of frames?  .