Cream butter and sugars till light and fluffy. Beat in egg and vanilla. Combine the next 5 ingredients; add to creamed mixture alternately with buttermilk. Fold in rhubarb.
Transfer to greased 9x13 pan. Sprinkle with cinn-sugar. Bake at 350 degrees for 35-40 minutes or till toothpick comes out clean from the center. Place on wire rack.
For sauce, in a small saucepan, combine the 1st 4 ingredients, bring to a boil over medium heat, stirring constantly. Whisk in small amount of hot mixture into the egg; return all to the pan, stirring constantly. Cook and stir until mixture is thickened and coats the back of a spoon. Stir in lemon peel and nutmeg. Serve warm with cake.