Is there a way to reset iCloud drive?
There is not a specific feature of iCloud drive that says "Reset all settings." however paying attention to the warnings when you sign out or turn off iCloud drive will reveal the trick.

So what you need to do is (FIRST!) make sure anything on iCloud drive you have copies of somewhere. Then you will need to turn off iCloud drive on all devices you are signed into iCloud in.

On every device you turn off iCloud drive on you should get a warning about removing files (it's been a while so I don't recall the exact wording). Tell iCloud drive to delete the files. 

Once you do that on all your devices iCloud drive should be empty. Personally I'd wait a day before turning it back on but, realistically, that is not likely to matter. Just turn it back on, add your files and watch them sync.

Now if it STILL fails, I would call Apple support and tell them what you have done, why and ask them to fix it for you.