People with diabetes can eat anything they want -- candy, cupcakes, apple pie, or other sweets. As long as your portions are reasonable, there are no forbidden foods. The key is to eat sweets in moderation, plan ahead, and watch your total carbs. For instance, if you want to have a small piece of cake for dessert, compensate by skipping another food with carbs.
Keep in mind that many "diabetic" candies and other sweets, which are sugar-free, still have calories and carbs that can affect your blood sugar. Even if a product is marketed for people with diabetes, never assume it's safe to eat an unlimited amount.