- Have both Google Desktop 2 and Google Talk installed.
- Put Google Desktop into Sidebar mode by right clicking the Google Desktop Search taskbar icon and selecting sidebar, then clicking the down arrow in the title bar of the sidebar and selecting the dock option you want (right or left). You can also select Down Arrow -> autohide if you don't like it taking up space on your screen.
- Click the down arrow in the title bar of the Google Desktop sidebar and select the option Add/Remove panels.
- Check Google Talk.
- Uncheck Gmail - Google Talk takes over for incoming email notification.
If at first the option "Google Talk" does not appear as a panel to be added, just close the sidebar and open it again. The option should appear. - thanks Rohan
You can also try restarting Google Talk to get the add panel option to appear. - A Commenter