Bake cake in baking pan; cool in pan 10 minutes. Remove from pan and cool completely. Position on foil-wrapped cake board cut to fit.
Ice bottom half of cupcake smooth using yellow tube icing from icing kit. Use spatula to make up-and-down swirls.
Combine white tube icing and blue tube icing from icing kit to get blue shown. Ice cupcake top smooth. Use spatula to make side-to-side swirls.
For eyes, use scissors to cut 1/4 in. ends from marshmallow. With cut sides down, attach to cake. For pupils, attach chocolate candy with white tube icing. For cheeks and nose, cut spice drops in half. For mouth, cut fruit leather into a smile shape and attach to cake. For cheeks and nose, cut spice drops in half. With cut sides down, attach to cake.