1/4 cup Grand Marnier (or other orange-flavored liqueur)
1/2 cup Fresh Orange Juice
Zest of 1 Orange
1/4 teaspoon Nutmeg (Freshly Ground)
To prepare candied-lemon zest, slice the rind from the lemons with a vegetable peeler, being careful not to remove any white pith. Slice the rind into 1/8-thick strips. Fill a small saucepan with 2 cups of water and heat over high heat until boiling. Add zest strips and blanch for 1 minute. Remove with a slotted spoon or spider and drain on paper towels.
Drain saucepan, add sugar and remaining 2 cups of water and heat over high heat until sugar dissolves. Lower heat to medium-low until mixture simmers. Add blanched zest and simmer until tender, about 15 to 20 minutes. Remove zest with a slotted spoon or spider and drain on a rack set over a rimmed baking sheet. Allow zest to dry uncovered for at least 1 hour or overnight.
In a 13" x 9" x2" baking dish, combine the melted butter and brown sugar. Arrange bread slices in the dish, overlapping as needed to fit. In a large mixing bowl, whisk together the eggs, milk, vanilla, Grand Marnier, orange juice, orange zest, nutmeg and salt. Pour egg mixture over the bread slices, allowing bread to absorb mixture. Top with walnuts, if using. Cover with plastic wrap and refrigerate for at least 3 hours and up to 12 hours.
Preheat oven to 350° and place a rack in the center. Allow the chilled casserole to stand at room temperature for 20 minutes before baking.
Bake casserole until browned and set, about 30 to 45 minutes. Remove to a rack to cool slightly.
To serve, sift powdered sugar over the casserole and top with candied lemon zest. Cut into serving pieces, place on warmed plates, and serve immediately.