Preheat oven to 325°F. Coat forty-eight 1- ¾-inch nonstick muffin cups with cooking spray. In a large bowl, combine cake mix, water, eggs and oil. Mix according to cake mix package directions. Divide the batter evenly between prepared muffin cups. Bake for 10 to 13 minutes or until a wooden pick inserted into centers comes out clean. Cool in muffin cups on wire racks for 5 minutes. Remove from muffin cups. Cool completely on wire racks.
In a medium bowl, fold strawberries and strawberry preserves into half of the whipped topping. Evenly divide mixture among the ice cream cups, spooning mixture into bottom of each ice cream cup. Place one cupcake in each ice cream cup. (Freeze the remaining 32 cupcakes for a later use.) Spoon the remaining whipped topping into a pastry bag fitted with a star tip. Pipe the whipped topping onto the cupcakes in ice cream cups. Sprinkle with rainbow nonpareils.