Yeah, I was trying to get rid of this one, too, as I prefer a desktop without icons, but it seems, that it is hardcoded somehow.
Still the advantages of Neal's LXDE are overwhelming, so I got used to it.
In your case, the Openbox set of PCLinuxOS would be an option, with tint2 as a panel and OB managing the desktop. Right-click application menus are the slickest solution for desktops, but not easy for people to adapt to.