The Battle Cupcakes were designed by Danny Vasquez, to house the team's Post-Mortem consciousness in case they ever died, so that he could reconstitute their bodies.
Gladiators[]
The Battle Cupcakes were built originally to fight to the complete and utter death. Orange won.
Ghost Transistors[]
Danny later reveals that he had secretly installed microchips in everyone's head to keep their consciousnesses running after their demise, and that the cupcakes are capable of carrying them. Sadness, the villain encountered in Issue 2, reconstituted Green so that she could chase after them, while they rode in orange.