Best cupcake in NYC (no not magnolia or buttercup or crumbs - trust me on this one)
http://www.sugarsweetsunshine.com/
Sugarsweet Sunshine on Rivington Street on the lower east side. they're all amazing but my faves are "the bob" which is yellow with chocolate almond butter-cream frosting, and Pistachio which is fucking amazing.
Within a block or two is also Economy candy where you can buy all the oldtimey candy plus gourmet chocolate, (and hand dipped graham crackers covered in dark chocolate).
AND Babeland