Preheat the oven to 375 degrees F. Spray a 9×13-inch baking pan with cooking spray and set aside.
For the peach filling- place the diced peaches in a large bowl and sprinkle with lemon juice. Mix gently. In a separate bowl whisk together flour, cornstarch, sugar, salt, cinnamon and nutmeg. Pour over the peaches and carefully combine. Set aside.
For the dough-in a large bowl whisk together the flour, sugar, baking powder, salt, and cinnamon. Cut in the butter with a pastry blender until butter is mixed in, but you still have small chunks of butter. Mix the vanilla and egg together. Add into the flour and butter mixture and combine. The dough will be crumbly. Pat half of the dough into the prepared pan.
Spread the peach mixture evenly over the bottom crust. Crumble the remaining dough over the peach layer. Sprinkle with cinnamon and sugar.
Bake for 45 minutes, or until the top is golden brown. Cool completely on a wire rack. Cut into squares and serve.
*Note-these bars are delicious on their own, but if you want an extra special dessert, add a scoop of vanilla ice cream.