You can simply press Ctrl+F12 to get what you expect from “Show Desktop” button on KDE panel. Pressing the same combination of keys will toggle the previous action.
However this article shows you how to add “Show Desktop” button to the KDE panel.
First right click on the panel to get the context menu as shown below. Press “Add Widgets…” menu item in that.

You will get the “Add Widgets” window as shown below.Look for “Show Desktop” entry in the list and drag that item on to your KDE Panel.

If you have done everything right, you should see a new button in your KDE panel as shown in the below diagram.

about 4 years ago
this is exactly the post I needed to see!
about 2 years ago
I will explain how is done in case of GNOME desktop which is most widely used desktop among Linux desktops. Especially because GNOME is the default desktop for Ubuntu and Fedora.
Right click on any panel and click on “Add to Panel…”, it would open “Add to Panel” window with a list of items that can be added to the panel. In the list, look for “Show Desktop” and either double click on it or drag on to the panel. Later you can move the button to where ever you want in the panel. I, as both Windows and Linux user, personally feel it at bottom-left corner.
Hope this helps my fellow GNOME desktop lovers! ;o)
about 2 years ago
Err, how to accomplish that on Fedora 14?
about 10 months ago
Well I got to say I was fustrated not to come up with the solution myself – but your how-to made it clear. Didn’t try to do that myself. Thanks for bringing my WinKey+D back in order