First, popupdeFaultIcon can be used to specify the obvious.
Second, the format shown for adding icons in the docs might be wrong if I'm not mistaken, anyway here's the right one:

*Popup .icon=C:\metapad.exe,1 &MetaPad c:\metapad.exe

Also make sure you have a recent build. It might give you the abbility to add some icons to some special elements.