You don't understand how "sortable" works. It takes a series of list items (which can be divs) and allows you to rearrange them. The divs can contain Raphael stuff if you like. Check out
http://jqueryui.com/demos/sortable/
You can also check out jqueryui's draggable and other interactions.
Your fiddle doesn't work because a) it's not a list, b) the two Raphael drawings are in one div, c) it doesn't include the necessary jqueryui components (e.g. core, widget, mouse).
My stuff is not publicly available, but you don't need me. Jqueryui has enough sample code to get you going.
Play with the jqueryui stuff first, get it working, then plop your Raphael into it.