Grease and flour a 13x9x2-inch baking pan or two 9x1-1/2-inch round cake pans; set aside.
Stir together flour, baking powder, cinnamon, soda, salt, and nutmeg.
In a large mixing bowl, beat butter with an electric mixer on medium speed for 30 seconds. Add sugar and vanilla; beat until well combined.
Add eggs, one at a time, beating well after each.
Stir together the milk and lemon juice. Add dry ingredients and milk mixture alternately to beaten mixture, beating on low speed after each addition, just until combined.
Stir in the carrots and zucchini and fold in the nuts. Pour batter into the prepared pan(s).
Bake in a 350 degree F oven 45 to 50 minutes (about 40 minutes for 9-inch pans) or until a toothpick inserted near the center(s) comes out clean. Place 13x9-inch cake in pan on a wire rack and cool thoroughly. Or for round layers, cool in pans on wire racks for 10 minutes. Remove cakes from pans; cool on wire racks.
Frost top of cake in 13x9-inch pan or fill and frost 9-inch layers with Pecan-Cream Cheese Icing. Makes 12 servings.
Prepare and frost cake; cover and chill up to 24 hours.
Combine cream cheese, milk, and vanilla. Beat until smooth and fluffy. Gradually add powdered sugar to creamed mixture; beat until smooth and fluffy. Stir in finely chopped pecans. If necessary, add additional milk to make frosting of spreading consistency.