PREHEAT oven to 375 degrees.
IN large bowl cream butter, sugar and lemon zest until light, about 5 minutes. Beat in egg and vanilla. Mash 1/4 cup of the berries. Beat into batter. Whisk together flour, baking powder and salt. Fold into batter alternately with milk. Fold into berries.
SPOON into 8 paper-lined muffin cups. Place topping of 3/4 teaspoons sugar and 1/8 teaspoons nutmeg, mixed, in small strainer and dust each muffin. Bake until muffins spring back when lightly touched, 20 to 25 minutes. Serve warm or at room temperature. Makes 8 muffins.