Place peaches in a greased shallow 2-1/2-qt. baking dish. In a small bowl, combine the brown sugar, flour, lemon juice, peel and cinnamon; sprinkle over the peaches.
Combine the flour, sugar, baking powder, salt and nutmeg. Stir in egg until the mixture resembles coarse crumbs. Sprinkle over the peaches. Pour butter evenly over topping.
Bake at 375° for 35-40 minutes.