Here's a procedure to get custom folder icons to display on Launcher buttons.
1. Drag a folder(s) with a custom icon onto the Launcher.
2. Option-click on the category button to open the related Launcher Items subfolder. If you have no Launcher category buttons, open the Launcher Items folder within the System Folder.
3. Select all alias items in the folder that do not appear correctly in the Launcher.
4. Choose Get Info from the File menu for the selected items.
5. Close those Info Windows.
6. Go back to the Launcher window, and if the icons aren't correct yet, click another category button and back to get the Launcher to update. If you have no Launcher category buttons, close the Launcher and open it again.
The buttons should now show the correct icons.