Cream the butter and sugar in a large bowl with an electric mixer. Beat in the eggs and vanilla.
Combine the flour, baking powder and salt in a second large bowl and mix well. Stir the flour mixture into the butter mixture 1 cup at a time. Chill the dough for 3 to 4 hours.
Preheat the oven to 350 degrees F. Line a cookie sheet with parchment. Roll out the dough and cut it into shapes with cookie cutters or a knife. Place the shapes on the prepared cookie sheet. If decorating with colored sugar, brush the cookies with milk and sprinkle with colored sugar (if using royal icing, leave unfinished). Bake until the cookies are just beginning to brown around the edges, 10 to 15 minutes, depending on the size of the cookies.
Remove the cookies to a rack to cool completely. If using royal icing, decorate the cookies as desired.
Combine the confectioners' sugar, meringue powder and 3/4 cup water in a large bowl. Mix slowly with an electric mixer until stiff enough to form peaks; the icing should be pure white and thick, but not fluffy and bubbly. If the frosting is over-beaten, it will get aerated which makes it harder to work with. If this happens, let the frosting sit to settle, and then use a rubber spatula to vigorously beat and smooth out the frosting.
Add up to 1 tablespoon food coloring and mix with a rubber spatula until the color is uniform. Gels are best with royal icing. You don't want to thin them with liquid colors. Be careful of adding too much color, which reduces the sheen of the frosting and can break down the consistency of the frosting over a couple of days. Store the icing at room temperature, covered, with plastic wrap on the surface.
Yield: 3 1/2 cups icing
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