Preheat oven to 350 degrees F. Line 13x9x2-inch baking pan with foil, grease foil; set aside. In a medium saucepan cook and stir sugar and butter over medium heat until butter melts. Remove from heat. Cool slightly.
Stir eggs and vanilla into sugar mixture. Stir in flour, baking powder, and 1/2 teaspoon nutmeg. Stir in nuts.
Spread mixture evenly into prepared pan. Bake for 25 to 30 minutes or until edges just begin to pull way from the sides of the pan. Cool in pan on a wire rack. Use foil to remove bars from pan; place on cutting board. Cut into diamonds. Drizzle with Eggnog Drizzle.
In a small bowl combine powdered sugar, vanilla and 1 teaspoon eggnog. Stir in additional eggnog, 1 teaspoon at a time, until icing reaches drizzling consistency. Divide mixture in half; tint half with red food coloring. Drizzle red and white icing over bars.