In a large bowl dissolve yeast in warm water; set aside.
In a medium saucepan heat and stir milk, granulated sugar and salt just until warm (120 degrees F to 130 degrees F). Using a wooden spoon, stir milk mixture, egg and 2 cups of the flour into the yeast mixture until combined. Stir in walnuts and raisins. Stir in as much of the remaining flour as you can.
Turn dough out onto a lightly floured surface. Knead in enough of the remaining flour to make a moderately stiff dough that is smooth and elastic (6 to 8 minutes total). Shape dough into a ball. Place in a lightly greased bowl, turning once to grease surface of dough. Cover; let rise in a warm place until double in size (1 to 1-1/4 hours).
Punch dough down. Turn dough onto a lightly floured surface. Cover; let rest 10 minutes. Meanwhile, grease a very large baking sheet*. Roll dough out to a 12x10-inch rectangle. Cut dough crosswise into twelve (1-inch) strips. On the prepared baking sheet, twist and weave 5 of the strips together, pinching together the ends and tucking them under the braid. Twist and weave 4 more strips together and place atop the first layer. Braid the remaining 3 dough strips and place atop the first two. Brush the loaf lightly with oil. Use 4 wooden or metal skewers, pushing in from the top, to secure layers.
Cover and let rise in a warm place until nearly double in size (30 to 45 minutes). Bake in 325 degree F oven 40 to 45 minutes or until bread sounds hollow when lightly tapped; remove skewers after bread is set. Cool bread on wire rack Drizzle with icing. Makes 1 loaf (24 servings).
In a small bowl combine powdered sugar, milk, and vanilla. Stir in additional milk, 1 teaspoon at a time, until icing reaches drizzling consistency.
If your oven will not hold a very large baking sheet, shape loaf on a lightly floured surface. Carefully transfer to a greased 15x10x1-inch baking pan. Let loaf rise and bake as above.