Is it safe to rename special user folders?

You can rename the folders in the file $HOME/.config/user-dirs.dirs. Here's the default:

# This file is written by xdg-user-dirs-update
# If you want to change or add directories, just edit the line you're
# interested in. All local changes will be retained on the next run
# Format is XDG_xxx_DIR="$HOME/yyy", where yyy is a shell-escaped
# homedir-relative path, or XDG_xxx_DIR="/yyy", where /yyy is an
# absolute path. No other format is supported.
#
XDG_DESKTOP_DIR="$HOME/Desktop"
XDG_DOWNLOAD_DIR="$HOME/Downloads"
XDG_TEMPLATES_DIR="$HOME/Templates"
XDG_PUBLICSHARE_DIR="$HOME/Public"
XDG_DOCUMENTS_DIR="$HOME/Documents"
XDG_MUSIC_DIR="$HOME/Music"
XDG_PICTURES_DIR="$HOME/Pictures"
XDG_VIDEOS_DIR="$HOME/Videos"

According to the Filesystem Hierarchy Standard in regard to /home directory, you can read:

/home is a fairly standard concept, but it is clearly a site-specific filesystem. The setup will differ from host to host. Therefore, no program should rely on this location.

Therefore an application that needs /home or even subfolders like /home/user/Music to run needs to be considered to have a bug.

Nevertheless, there may be applications that look up standard directories as defined by xdg-user-dirs, as BTW does your system when you change locale.

It may most likely be safe to simply rename standard folders in your home, but it is a much better idea to notify xdg-user-dirs the way lukasz already pointed out to avoid unwanted side effects from applications that rely on existing standard paths.

I'm currently using Ubuntu 11.10 in German. I noticed, that the Desktop folder's name is "Arbeitsfläche". Unfortunately I am used to "cd Desktop" instead of "cd Arbeitsfläche". Is it possible to rename my Arbeitsfläche to Desktop without breaking my system? source

Create A Symbolic Link

You could either do a simple trick which would be to create a symbolic link to Arbeitsfläche. This is guaranteed to work!

cd ~; ln -s Arbeitsfläche Desktop

Modify the naming

The naming of these special folders can be specified by a set of variables. You would need to open the file ~/.config/user-dirs.dirs for editing and change the following line:

XDG_DESKTOP_DIR="$HOME/Arbeitsfläche"

to

XDG_DESKTOP_DIR="$HOME/Desktop"

Then you would need to create the appropriate directory and move your data from the old one to the new one. A log-in and log-out should be enough. Hopefully ;)

But with this solution, it is not impossible that some weirdly developed applications gets confused. Whereas with a symbolic link, this will always work!