Heat oven to 350. Combine butter and sugar in large bowl. Beat at medium speed, scraping bowl often until creamy. Add eggs; continue beating until well mixed. Reduce speed to low. Add flour and baking powder; continue beating until well mixed. Stir in crushed candy.
Divide dough into fourths on lightly floured surface. Shape each fourth into 9 x 1 1/2 inch round logs with lightly floured hands. Place logs 3 inches apart onto lightly greased large cookie sheet.
Bake for 18 to 20 minutes or until tops are cracked and ends just start to turn light brown. Remove from oven; reduce temperature to 325. Cool logs 10 minutes on cookie sheet.
Carefully remove logs to cutting surface. Cut each log into 1/2 inch slices with sharp serrated knife. [Discard ends] Arrange pieces on same cookie sheet, cut-side down.
Bake for 12 to 14 minutes, turning once, or until cookies are light golden brown and crisp on both sides. Place onto cool rack; cool completely.
Place candy coating in 2 quart saucepan. Cook over medium heat, stirring occasionaly, until melted [5 to 7 minutes]. Remove from heat. Stir in food color and peppermint extract.
Dip half of each biscotti into melted coating. Shake excess into pan. Place onto waxed paper; immediately sprinkle with decorator candies, sugars or crushed candy canes, if desired. Let set at room temperature until coating is hardened.