In a large bowl, whisk together the flour, 1/2 cup sugar, baking powder, salt, and nutmeg.
In a separate small bowl, whisk together the milk, egg, 2 tablespoons melted butter, and vanilla extract.
Pour the wet ingredients into the dry ingredients and mix until just combined. Do not overmix; a few lumps are fine.
Lightly spray your donut pan or cut-out shapes with non-stick spray. If using a basket, line it with parchment paper designed for air fryers.
Place dough into the air fryer basket or pan, filling molds about two-thirds full. Work in batches if necessary.
Preheat your air fryer to 350 degrees Fahrenheit (175 degrees Celsius).
Air fry the donuts for 6 to 8 minutes. Check for doneness; they should be lightly golden and spring back when touched.
While the donuts cook, prepare the coating: Mix the 1/2 cup sugar and 2 tablespoons cinnamon in a shallow dish. Melt the remaining 4 tablespoons of butter in a small bowl.
As soon as the donuts come out of the air fryer, brush them generously on all sides with the melted butter.
Immediately dip or roll the warm donuts in the cinnamon sugar mixture until fully coated.
Serve warm.
Notes
For easy removal, use silicone donut molds inside the air fryer basket.
If you do not have a donut cutter, you can roll the dough into small balls and flatten them slightly before cooking.
Adjust the air fryer temperature down to 325 degrees Fahrenheit if the donuts brown too quickly.