For the cake: Preheat oven to 350 degrees F. Line 24 muffin tins with paper liners.
Using a hand mixer or standing mixer, cream the butter and vanilla sugar together until fluffy, about 2 to 3 minutes. Add eggs, one at a time and vanilla extract, beating until smooth.
Combine the flour, nutmeg, baking soda and salt in a medium bowl. Add half the flour mixture to the creamed butter, then add the sour cream, and then the rest of the flour. Beat until well combined, taking care not to over mix. Gently fold in the chopped apples.
Divide batter between prepared muffin tins, filling them 1/2 way full. Bake until a toothpick inserted into the center of the cupcakes comes out clean and the tops spring back when pressed gently, about 20 minutes. Cool the cupcakes in the tin on a rack for 10 minutes then remove from the tin and cool completely.
Put apple butter into a small pastry bag with an open tip Squeeze a small amount into the center of each cupcake. Continue cooling completely. Then frost with icing.
For the frosting: Using a hand or standing mixer, beat cream cheese and butter together, at medium speed, until fluffy, about 2 minutes. Add in vanilla and lemon juice. On low speed, gradually add in confectioners' sugar and beat until well combined. Frost as desired.
To make vanilla sugar, tuck a whole vanilla bean into some granulated sugar. In a day or two, you have lovely vanilla flavored sugar.
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