A folder appeared on my desktop labeled "Desktop - imac's iMac". Can anyone tell me what it is and whether I need to keep it or can I trash it?

If I did it was completely unintentional.

Often during an upgrade or update we are asked if we want to have certain features turned on. I almost checked OK as many have done. I think Apple should not turn them on and make it our responsibility to turn them off. If you did turn it on you weren't the first nor will be the last to fall into that trap.

So, go to the System/Apple ID/iCloud preference pane and see if iCloud Drive is checked in the right hand pane. If it is click on Options and see if Documents and Desktop Folders is checked.

That's your iCloud Drive. It should be available in the sidebar of any Finder window:

You put it in the sidebar via Finder's Sidebar preference pane:

Post a screenshot of it on your Desktop. Also Control (right) - click on it, select Get Info from the contextual menu and see what the the Info pane says about it.

I don't know. If it were me I'd try deleting it and see how it goes. However, I have a Time Machine backup of my drive and two separate clones of the drive on external SSDs so I'm covered pretty will in case of disaster.

What's in it?

I don't think that folder should be where it is. Did you have iCloud Drive enabled and then disabled it?

Do you want to have the iCloud Drive enabled and have your Documents and Desktop folders included on it?