The default location of your Desktop folder is ~/Desktop. You might prefer another location. If you by accident deleted the Dekstop folder, it will be stuck in your Trash folder as you can't put it back. These two steps enable you to change or restore your desktop folder:
In step 1 look for this entry: XDG_DESKTOP_DIR. Make it like this: XDG_DESKTOP_DIR="$HOME/Desktop"
Instead of step 2 you might also log off and log in again.
This is only tested on Gutsy.