Beat together butter and sugar until creamy. Blend in egg, vanilla and peppermint extract. Sift together flour, baking powder and salt; gradually add to creamed mixture. Stir in oats. Roll out dough between 2 sheets of waxed paper to form a 12 x 6" rectangle. Refrigerate several hours or overnight. Remove top sheet of waxed paper. Cut into 6 x 1/4" slices. Shape into ropes, twisting to form candy canes. Bake on ungreased cookie sheets in preheated moderate oven (375° F) 8 to 10 minutes. Cool on cookie sheets 1 minute before removing to wire racks. Decorate with confectioners sugar frosting and red hot cinnamon candies.