Preheat oven to 350°F (175°C) and grease a 9×13-inch baking dish.

1. In a small bowl, toss diced apples with 2 tbsp granulated sugar and 1 tsp cinnamon. Set aside.
2. In a large mixing bowl, cream butter, granulated sugar, and brown sugar until light and fluffy. Add eggs one at a time, then mix in vanilla.
3. In a separate bowl, whisk together flour, baking powder, salt, and nutmeg.
4. Gradually add dry ingredients to the creamed mixture, alternating with milk, mixing until just combined.
5. Pour half the batter into the prepared dish. Top with half the apple mixture and half the cinnamon swirl (1/3 cup brown sugar + 1 tsp cinnamon).
6. Repeat with remaining batter, apples, and cinnamon sugar. Use a knife to gently swirl through the layers.
7. Bake for 45–50 minutes, or until a toothpick inserted in the center comes out clean.
8. While the cake cools slightly, whisk powdered sugar, milk, and vanilla until smooth to make the glaze.
9. Drizzle glaze over warm cake. Let it sit for 15 minutes before slicing and serving.