Sift flour with baking powder and add lemon rind.
Beat butter with sugar until creamy. Add egg and continue beating while adding milk alternating with flour.
Transfer batter to a 10 inch (22 cm) pie pan or a round loose bottom pan.
Peel and core apples, and cut in 4 wedges. Dip each apple wedge in water and cover with brown sugar. Place apple wedges over cake batter forming a circle. Sprinkle nuts, raisins, cinnamon and dot with butter.
Bake in oven 350 °F (180 °C) for 45 minutes.
Remove from oven. Cool and unmold.
Mix arrowroot with lemon juice and sugar to taste. Heat, stirring until thickened. Glaze cake with this mixture.