Here's an easy way to make a birthday cake more festive as well as to eliminate dripping candlewax on the cake. Use Lifesaver Candies as the candle holders! You can either use the hard candy version or the gummy version for the same effect.
I've seen this done with a two layer cake with vanilla frosting - then the colorful candies become the candle holders on top. And you can surround the cake plate with the lifesavers as well. You could also do this on individual cupcakes. Very cute!