This is a St. Patrick's Day cake I did about two years ago ... during the beginning of my cake decorating phase (but before my photography phase, so sadly the pics aren't great). It's a simple white cake with some green gel food coloring to get the perfect shade of green without ruining the consistency of the cake. It is a wonderful surprise to those eating it when they cut through the white icing to see bright green cake!! The rainbow is simply M&Ms flipped so the M isn't visible. :)
If I could do this cake again I would grab enough M&Ms to line the entire side of the cake in rainbow. You could also do just about any flavor of cake. I'm not fond of it personally, but a small dollop of some kind of mint extract would be a nice surprise to those who are fond of it in food.