Melt two tablespoons of butter in a saucepan over medium heat. Add diced apples, nutmeg and cinnamon. Cook until apples are soft, about 3 minutes. Remove from heat and let cool.
Preheat oven to 350 degrees (f) and prepare a Bundt pan with butter and flour.
Sift together flour, baking powder and salt. In a separate bowl, cream together one-half cup of butter with the sugar. Add three eggs, one at a time and beat well. Mix in vanilla and milk. Combine with dry ingredients. Fold in cooked apples.
In a separate bowl, combine cream cheese, one egg, 1/2 cup sugar and the zest of one lemon. Mix until smooth in texture.
Pour half the cake batter into prepared Bundt pan. Spoon cream cheese filling evenly over batter and then cover with remaining half of the batter. Bake for 50 - 55 minutes, or until cake is done. You can test doneness by pressing lightly on the cake to see if it springs back. Cool completely.
Prepare caramel glaze with pecans. Melt butter in a medium saucepan over medium-low heat. Add brown sugar and cook, stirring until sugar is melted completely. Add salt and cream and continue cooking and stirring for 2 minutes. Let cool for 5 minutes. Remove cake from pan and spoon glaze evenly over cake. Sprinkle chopped pecans over top.