Heat oven to 325 degrees F (165 degrees C).
In a bowl, combine the flour, sugar, baking soda, salt, and nutmeg.
Add in the egg, vanilla, and crushed pineapple and stir well to combine.
Fold in the peanuts.
Pour into a greased 11.35-in. x 8-in. x 1-in. (Quarter Sized) baking pan.
Bake for 25-30 minutes or until toothpick inserted in the center comes out clean. Cool.
For The Icing:
In a small bowl, mix together the cream cheese and the butter.
Slowly add the powdered sugar and mix until smooth. Spread over cooled cake and sprinkle with chopped peanuts.