There is a KDE bug that has been around for some time which is in the upstream report at https://bugs.kde.org/show_bug.cgi?id=300708 which seems to be that if you update KDE (as in today's update to KDE 4.10.4-1) whilst being logged in to KDE you can lose your background wallpaper image. Updating from a text console without being logged in to the graphical desktop does not cause the issue to happen.
There is a workaround in the first comment in the report link above in case anyone gets caught by this. -- mike c
