use apple-i to pull up info screen on both the application/folder you want to change the icon of and the new icon itself.
in that info screen, there is a small version of the icon. click on the custom icon you want to use, apple-c (copy).
go to the info screen for the target app/folder, click on the small icon, apple-v (paste).
if you want to restore the original icon, click on the small icon, press 'delete'.