Seems that Nautilus (3.26.2) killed my Downloads folder. Folder is completely gone. It also disappeared from that left side bookmark bar. And getting off entries (like Downloads, Documents, etc) isn't easily done by right click delete btw.
I didn't move it anywhere else - checked it.
Also searched my history (history | grep Downloads) - nothing suspicious.
Not able to reproduce, I quite clearly have a Downloads folder. Sounds like you accidentally did a permanent delete on it via Nautilus itself (so it skips trash). Just re-add the folder and restart.
Well considering the update to 3.26.2 happened in November and the only thing that was added since then was a patch for mouse buttons, it frankly sounds more like a user error than an issue in Nautilus.