While TouchFlo3D allows you to set any picture as your wallpaper, this only works on the Home screen, and the level of control over the appearance of the wallpaper is very poor.
XDA-Developer Maranell0 decided to do something about the situation however, and has created a desktop wallpaper editor which allows one to easily adjust and crop a picture, and then turns it into an easily installed .CAB file. Even better, the wall paper will be available on all tabs.
The wallpaper only work on HTCâ€™s latest version of TouchFlo3D,as found on the HTC Touch Diamond 2 and recent hacked ROMâ€™s.
See this XDA-Developers thread for more information and the download.