1. Remove wrappers from chocolates; set aside. Heat oven to 350°F. Line muffin cups (2-1/2 inches in diameter) with paper bake cups.
2. Combine butter, sugar, eggs and vanilla in large bowl. Beat on high speed of mixer 3 minutes. Stir together flour, cocoa, baking soda, salt and baking powder; add alternately with water to butter mixture, beating just until blended. Fill prepared muffin cups about 1/2 full with batter. Place chocolate piece in center of each.
3. Bake 20 minutes or until top springs back when touched lightly in center. Remove from cups to wire rack. Cool completely.
4. Tint frosting with red and yellow food color to make orange. Frost cupcakes with orange frosting. Cut up candies to make "monster" faces. Yields about 2-1/2 dozen cupcakes.