In advance: Make hats. Trim sugar cones to 2 3/4 in. long. Ice smooth with spatula using royal icing; let dry.
Bake and cool cupcakes in silicone cups supported by cookie sheet. Using tip 1A and stiff consistency buttercream, pipe a mound of icing on top for head. Smooth with spatula. For arms, cut lollipop sticks to 3 in.; insert 1 1/2 in. into cupcake. Pipe arms with buttercream, inserting tip 21 over stick and pulling out bag with even pressure. For hands, roll out spice drops on waxed paper sprinkled with sugar. Using pattern, cut hand with knife; reverse pattern for opposite hand. Attach hands to arms with dots of icing.
For Santa, pipe tip 3 dot eyes and nose (flatten and smooth with finger dipped in cornstarch). With tip 2, pipe in mouth, eyebrows and dot pupils (flatten and smooth). Position hat. Pipe tip 4 zigzag pompom, fur trim, hair and beard, outline moustache. For elf, attach hat. Pipe tip 4 zigzag pompom and tip 352 pull-out trim. Pipe tip 3 dot eyes (flatten and smooth). With tip 2, pipe in mouth and add dot pupils (flatten and smooth). Pipe tip 4 pull-out dot nose and dot cheeks (flatten and
smooth). Add tip 352 pull-out leaf ears.