The main idea behind Real Desktop is to transform the 2D desktop of Windows in a desktop that resembles the desk your monitor is placed on. It is a pseudo-3D environment for Windows that displays icons and the desktop itself in 3D.
Real Desktop comes in two flavors: a light version which ships with reduced functionality but does not cost a dime and a standard version that has all the functionality but is available for €5.95 in the online store.
Attention: The installer will modify the start page in Internet Explorer automatically if you don't uncheck that option (make search.real-desktop.de as my start page in IE) during setup.
The three dimensional approach is not overly visible in the light version but it should be sufficient to get an understanding of how it works.
Once installed the desktop changes the perspective and displays all icons as 3D icons instead of 2D icons. These icons can be rotated, placed on top of each other and handled just like before. You may sort icons in various ways and execute programs and run files just like before.
The main benefit of this approach is a more natural view of the desktop making it easier to sort and recognize files and folders on the desktop. The light version has some restrictions: icon size cannot be changed for instance and there is no option to use a custom wallpaper in that version.
The appearance of the desktop looks much nicer though than that of the regular Windows desktop. I think it's worth a try if you are looking for something unique. Only Windows XP and Windows Vista are officially supported.
Update: Real Desktop is compatible with all recent versions of Windows as well. We have tested the program under Windows 7 64-bit and it executed fine on the system.
Recent updates have introduced new features to the free version. It is now for instance possible to scale down or up icons (make them smaller or bigger) or to hide file names on the desktop.
The program's preferences offer additional features. You may disable sound output there for instance, change the hotkey, switch the position of the main menu bar, or switch the lasso selection mode (freehand) to a rectangular mode instead.
Real Desktop provides you with an alternative desktop that provides a different view on the icons that you have placed on the desktop of your Windows machine. It goes without saying that it only makes sense on systems with at least a couple of icons on the desktop though as it does not offer much in terms of functionality besides the visibility change and icon handling.