By default backgrounds are handled by Nitrogen, accessed through the menu under Settings –> Choose Wallpaper. Bundled wallpapers are stored in ~/images/wallpapers/shared/backgrounds although you can add your own to ~/images/wallpapers/shared and they will automatically show up in the Nitrogen selection menu.
Wallpaper directories specified in Nitrogen's config file (~/.config/nitrogen/nitrogen.cfg) are only used when invoked without a directory argument. When invoked with a directory argument, as in Statler's openbox menu entry for Choose Wallpaper, the .cfg-specified directories are ignored and invisible on Nitrogen's Preferences –> Add dialog. To use Nitrogen's preferences, edit the openbox menu with obmenu or other tool to remove the directory name from the menu item's Execute string. Alternatively, you can leave the menu item as-is and create or link any other directories under ~/images/wallpapers/.
By default Icons aren't shown on the desktop. To add desktop icons, see here.
One option is this script for a wallpaper slide show, preliminary instructions are here. For instructions on downloading and installing scripts look here and for instructions on adding it to your autostart folder look here.
the small guide to desktop icons would be better linked to the 'real' one here: http://crunchbanglinux.org/wiki/howto/add_desktop_icons would also be nice to have some links to the threads about setting the terminal as your background etc. – rhowaldt machinebacon: I'd leave the page as it is and rather create a metapage with links to the separate subcategories and entries (see wiki thread on the forums)pidsley: I'd rather see the desktop icons stuff all in one place and lose it from this page; maybe keep the background info here (Nitrogen) and maybe add somthing about feh?