KDE 4.2.2 released

That's actually not that easy. We were able to close a large number of bugs related to multihead support, but apparently not all. There are huge amounts of different cases we need to deal with (different layouts, different randr versions, different expectations, ...), and on top of that graphics drivers that expose their own interesting ways of doing multihead.

We're definitely well under way of fixing most of those problem, though for specific cases we need the help of the users, in the form of good bugreports and testing possible fixes.

FWIW, I've been using a dualhead setup since before 4.0 was released with KDE4 and I didn't encounter grave problems with it. YMMV, of course.

As to the psycho behaviour of icons on the desktop for two monitors, they're just different views on a folder (or on different folders, if you'd like it to behave that way). Not sure what's psycho about that, maybe you can explain how you'd expect it to behave?