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CAKE:
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1. Preheat the oven to 350°F. With a pastry brush, spread 2 tablespoons of the softened butter evenly over the bottom and sides of two 9-inch layer-cake pans.
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2. Sprinkle 2 tablespoons of flour into the pans and tip them from side to side to spread the flour evenly. Then invert the pans and rap them sharply on the bottom to remove any excess flour.
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3. In a deep bowl, cream the remaining 8 tablespoons of butter with the sugar, beating and mashing them against the sides of the bowl with a large spoon until the mixture is light and fluffy.
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4. Beating constantly, slowly pour in the eggs in a thin stream and continue to beat until the eggs are completely absorbed.
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5. Sift the remaining 2 cups of flour, the baking powder and salt together and add them to the batter ½ cup at a time, beating well after each addition; add the coconut milk ¼ cup at a time alternately with the flour. Beat in the teaspoon of vanilla and the lime peel.
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6. Pour the batter into the prepared pans and bake in the middle of the oven for ½ hour, or until a cake tester or toothpick inserted in the center comes out clean. Cool the cakes in the pans for about 5 minutes, then turn them out onto wire cake racks to cool completely.
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FROSTING
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1. Meanwhile, prepare the frosting in the following way: Combine the sugar, water and the vanilla bean, if you are using one, in a small sauce-pan and bring to a boil over moderate heat, stirring until the sugar dissolves.
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2. Boil briskly, uncovered, without stirring until the syrup thickens and reaches a temperature of 238°F on a candy thermometer, or until a few drops spooned into cold water immediately form a soft ball. Remove the pan from the heat and discard the vanilla bean.
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3. With a wire whisk or a rotary or electric beater, beat the egg whites and cream of tartar until they are stiff enough to stand in soft, moist peaks on the beater when it is lifted from the bowl. Beating constantly, slowly pour the syrup in a thin stream into the egg whites.
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4. Continue beating for 5 to 10 minutes longer, until the mixture thickens. Let the frosting cool to room temperature. Stir in the lime juice and the ½ teaspoon of vanilla extract if you have not used the vanilla bean.
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5. To assemble, place one layer of cake on a serving plate and, with a spatula or knife, spread it evenly with about ½ cup of the frosting.
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6. Sprinkle about ¼ cup of the grated coconut over the frosting, then set the second cake layer on top. Spread the top and sides with the remaining frosting and sprinkle them with the rest of the coconut.
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