I have never tried deleting the desktop folder, so I really can't say if it would hurt the system or not. I tried making everything visible (system files etc.) and the only thing I could see that I don't usually see was a Thumbs.db folder, which will just recreate itself.

But if anyone is willing to test it (Remember I did NOT recommend this, then I think starting up in safe mode, bringing up the command prompt, and then ending the explorer.exe process would allow you to delete the desktop folder and then create a new using the mkdir Desktop command before starting the explorer.exe process again should work... maybe??

Remember I did NOT recommend this, so if anything goes wrong, don't blame me