Cream shortening, sugar & egg until light and fluffy. Sift together flour, salt, baking powder and nutmeg. Add alternately with milk to cream mixture. Mix well to a stiff dough. Stir in nuts. Drop by tablespoon into well greased small size muffin pan cups. Bake at 400 for 20 min. Combine powdered sugar and cinnamon in paper bag. Dip top of doughnuts in melted butter, shake 2 or 3 at a time in bag with sugar mixture.