1Heat oven to 350°F (325°F for dark or nonstick pan). Place foil or paper baking cup in each of 24 regular-size muffin cups.
2In large bowl, beat cake mix, water, oil and eggs with electric mixer on low speed 30 seconds, then on medium speed 2 minutes, scraping bowl occasionally. Fold in 1/4 cup candy. Divide batter evenly among muffin cups, filling about two-thirds full.
3Bake 15 to 20 minutes or until toothpick inserted in center comes out clean. Cool 10 minutes; remove from pans to cooling racks. Cool completely, about 30 minutes.
4Lightly frost cupcakes with frosting. Pour 18 pouches candy onto small plates (use separate plates for each color or mix colors together); roll frosted cupcakes in candy.