For those who like a clean desktop, here's how I tidied mine up a bit but still kept my desktop folders. I copied a 32x32 pixel image from a section of my desktop wallpaper, created a folder on my desktop, and changed the folder icon to the 32x32 image (to do this, open the 32x32 image in Preview and copy the image to the clipboard. click on the folder and bring up the info pane with Command-I. Click on the folder image at the top left of the info pane and paste the 32x32 image with a Command-V). Then I changed the folder name to a couple of spaces, and carefully dragged the folder icon over the section of the wallpaper that I copied it from. When you don't have the folder selected it's invisible on the desktop, but it's there if you click on it. I chose a section of wallpaper that I can find easily, on the right edge of my screen. You can have several folders, each with a different number of spaces in the name. You should chose an image pixel size to match what you have the icon size set to in Finder > View Options. I've attached a couple of clips with a folder selected and deselected.