Desktop restrictions can be implemented by editing the Explorer registry keys:

Hive: HKEY_CURRENT_USERS
Key: SOFTWARE\Microsoft\Windows\CurrentVersion\Policies\Explorer
Name: NoCommonGroups
Type: REG_DWORD
Value: 1 common program groups do not appear on Start Menu.

Name: NoDesktop
Type: REG_DWORD
Value: 1 hide all desktop icons.

Name: NoFileMenu
Type: REG_DWORD
Value: 1 File menu in Explorer is removed

Name: NoFind
Type: REG_DWORD
Value: 1 remove Find command from Start Menu

Name: NoNetConnectDisconnect
Type: REG_DWORD
Value: 1 removes Map Network Drive & Disconnect Network Drive menu and right click options

Name: NoNetHood
Type: REG_DWORD
Value: 1 remove Network Neighborhood icon and prevent network access from Explorer (still works from command prompt)

Name: NoRun
Type: REG_DWORD
Value: 1 Run command removed from Start Menu.

Name: NoSetFolders
Type: REG_DWORD
Value: 1 hides Control Panel & Printers & My Computer in Explorer and on the Start Menu.

Name: NoSetTaskbar
Type: REG_DWORD
Value: 1 Only Drag and Drop can be used to alter the Start Menu and Desktop. The Taskbar does not appear on the Start Menu.

Name: NoTrayContextMenu
Type: REG_DWORD
Value: 1 menus do not display upon right click of the Taskbar, Start Button, Clock, or Taskbar Application icons. The entry is only available for NT 4 with SP 2 or greater.

Name: NoViewContextMenu
Type: REG_DWORD
Value: 1 menus do not display upon right of Desktop or Explorer's Results pane. NT 4 SP2 option.

Name: RestrictRun
Type: REG_DWORD
Value: 1 only programs in Restrict subkey can be run on the workstation.

Name: NoClose
Type: REG_DWORD
Value: 1 remove the Shut Down button from Start Menu.

title says it all

Gives an in-depth look at the NT/Windows 95/98 system policies. Step-by-step walkthroughs.