I changed $HOME/.config/user-dirs.dirs so that XDG_DESKTOP_DIR="$HOME/Desktop/foobar" and everything seems to behave fine, so I can't replicate your experience, which makes it hard to fix. Could you start with a fresh system (maybe a virtual machine) and come up with some clear steps?
Barring that, you might bark up the tree of libqt5xdg3 but there's nothing about it, from what I can tell, that deals with the Desktop directory different than any others. ** Changed in: pcmanfm-qt (Ubuntu) Status: New => Incomplete -- You received this bug notification because you are a member of Ubuntu Bugs, which is subscribed to Ubuntu. https://bugs.launchpad.net/bugs/1768961 Title: xdg user-dirs not being read/stored correctly for desktop icon in left panel To manage notifications about this bug go to: https://bugs.launchpad.net/ubuntu/+source/pcmanfm-qt/+bug/1768961/+subscriptions -- ubuntu-bugs mailing list ubuntu-bugs@lists.ubuntu.com https://lists.ubuntu.com/mailman/listinfo/ubuntu-bugs