It's pretty broken right now.
Basically it makes sure we always have a desktop file which we can edit (either copying the one of the app or making a Link one in case of files). (the plasma 4 applet did some mental stuff with creating a desktp file only if you edited it and it wasnt writable etc etc). I made sure though that existing applets (plasma 5.7) will be gracefully migrated by creating a desktop file on first launch.
Due to some kio bug the editing of desktop file doesnt actually work.
Also launching it is broken as a I cant figure out a KRun call that actually work with both desktop files (app or Link)