Heat oven to 350°F. In large bowl, beat butter and 1/2 cup powdered sugar with electric mixer on low speed until blended. Stir in remaining cookie ingredients.
Shape dough by tablespoonfuls into balls. On ungreased cookie sheets, place balls 1 1/2 inches apart.
Bake 12 to 15 minutes or until very lightly browned. Remove from cookie sheets to cooling rack; cool 5 minutes.
In medium bowl, mix coating ingredients. Working in batches, gently roll warm cookies in coating mixture. Cool on cooling rack 5 minutes. Roll in mixture again.