`ContentView` reads child files recursively when you drag and drop a directory.

ContentView.swift

struct ContentView: View {
    @State private var isTargeted = false

    var body: some View {
        Rectangle()
            .fill(self.isTargeted ? .green : .white)
            .frame(maxWidth: .infinity, maxHeight: .infinity)
            .onDrop(of: [.directory], isTargeted: self.$isTargeted) { providers in
                for provider in providers {
                    _ = provider.loadFileRepresentation(for: .directory, openInPlace: true) { url, _, _ in
                        guard let url else { fatalError() }
                        guard url.startAccessingSecurityScopedResource() else { fatalError() }
                        defer { url.stopAccessingSecurityScopedResource() }
                        do {
                            try loadItems(at: url)
                            print("successfully loaded")
                        } catch {
                            print(error.localizedDescription)
                        }
                    }
                }
                return true
            }
    }

    func loadItems(at url: URL) throws {
        let enumerator = FileManager.default.enumerator(
            at: url,
            includingPropertiesForKeys: nil,
            options: [],
            errorHandler: nil
        )
        while let item = enumerator?.nextObject() as? URL {
            if !item.hasDirectoryPath {
                let data = try Data(contentsOf: item)
                print("\(item.absoluteString) is \(data.count) bytes")
            }
        }
    }
}

Modern version:

struct DirectoryItem: Codable, Transferable {
    let url: URL

    static var transferRepresentation: some TransferRepresentation {
        FileRepresentation(importedContentType: .directory, shouldAttemptToOpenInPlace: true) { received in
            .init(url: received.file)
        }
    }
}

struct ContentView: View {
    @State private var isTargeted = false

    var body: some View {
        Rectangle()
            .fill(self.isTargeted ? .green : .white)
            .frame(maxWidth: .infinity, maxHeight: .infinity)
            .dropDestination { (items: [DirectoryItem], _) in
                for url in items.map(\.url) {
                    guard url.startAccessingSecurityScopedResource() else { fatalError() }
                    defer { url.stopAccessingSecurityScopedResource() }
                    do {
                        try loadItems(at: url)
                        print("successfully loaded")
                    } catch {
                        print(error.localizedDescription)
                    }
                }
                return true
            } isTargeted: {
                self.isTargeted = $0
            }
    }

    func loadItems(at url: URL) throws {
        let enumerator = FileManager.default.enumerator(
            at: url,
            includingPropertiesForKeys: nil,
            options: [],
            errorHandler: nil
        )
        while let item = enumerator?.nextObject() as? URL {
            if !item.hasDirectoryPath {
                let data = try Data(contentsOf: item)
                print("\(item.absoluteString) is \(data.count) bytes")
            }
        }
    }
}