The correct answer is: A. Their protective sleeves.
5 1/4 diskettes are very sensitive to dust and moisture, and can be easily damaged if not stored properly. Keeping them in their protective sleeves will help to protect them from these elements and keep them in good condition for longer.
Option B is incorrect because plastic bags can trap moisture, which can damage the diskettes. Option C is incorrect because diskettes should be stored in an upright position to prevent the magnetic media from being damaged. Option D is incorrect because the floppy drive is not a safe place to store diskettes when they are not in use. Option E is incorrect because all of the other options are incorrect.