Flashback Drop does work as implied by the documentation for the Express Edition of 11g, but the default configuration needs to be modified to get it to work.
By default XE isn't in ARCHIVELOG mode as shown by...
SELECT log_mode FROM v$database;
If the query does not return ARCHIVELOG then follow these instructions to turn it on.
The following expert is from found in 10g Backup and Recovery Basics (strange place, I know) in a section called Limitations and Restrictions on Flashback Drop:
The recycle bin functionality is only available for non-system, locally managed tablespaces. If a table is in a non-system, locally managed tablespace, but one or more of its dependent segments (objects) is in a dictionary-managed tablespace, then these objects are protected by the recycle bin.
Apparently the default tablespace in XE is SYSTEM as seen by the following:
SELECT property_value FROM database_properties WHERE property_name='DEFAULT_PERMANENT_TABLESPACE';
To determine what the tablespace is for the user you are logged in as, run the following:
SELECT user, default_tablespace FROM dba_users WHERE username=user;
If the user is a built in account, then you will need to create a new user and assign it to a different tablespace such as USERS. If your user is already not a built in account, but is using the SYSTEM tablespace, then simply change the default tablespace as follows:
ALTER USER myusertoalter DEFAULT TABLESPACE users;
ALTER USER myusertoalter QUOTA UNLIMITED ON users;