How do I restore the default Windows 7 "Desktop" folder?

Try these options:

1. Go to C:\Users\<username> and see if a Desktop folder exists. If it does, then move it to the new location via the right-click -> Properties -> Location method.
2. If you can't find your Desktop folder there, try going to shell:Desktop (from Explorer address bar or Start menu search field). If it works, move it as above.
3. Check the Recycle Bin to see if the Desktop folder you deleted is still there. If it is, then restore it.
4. If all above options fail, try the following:
   • open regedit
   • navigate to HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\User Shell Folders
   • in the right-hand pane find the entry called Desktop
   • go to the folder it points to and move that to your new location
   • (alternatively, edit the entry directly to point to your new location, then log out and back in for the setting to take effect)