Bravo!
The method you specified is working precisely and I got back all my icons. Luckily when I was deleting the /tmp, I logged in as user, not as root that saved me.
--------- background on deleting /tmp files ------------------
I was trying to take a system backup using a GUI tool instead of tar - my intention was to take incremental backup. While I was in between, it prompted me very low diskspace. Then I thought tmp is useless and selected all files in Nautilus and pressed Delete. Gosh!! 100s of Nautilus opened. I could not kill all. Even after reboot it existed. Started killing one by one. Somehow when I reached killing the last Nautilus window, Desktop got disappeared.
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Had you been not telling me this solution of deleting ~/.nautilus and ~./gnome2 contents, I thought of populating my home directory with all ~/. files (hidden files). Would that have worked?
Thanks a million for pointing to one correct solution.