Preheat oven to 350 degrees F (175 degrees C.) In a large bowl, combine sliced peaches with juice, 2 tablespoons melted butter, a pinch of cinnamon and a pinch of nutmeg. Dissolve cornstarch in water, then stir into peach mixture; set aside.
In another bowl, combine milk, sugar, flour, baking powder and salt. Beat until smooth - mixture will be thin.
Melt 1/2 cup butter in a 9x13 inch pan. Pour batter over melted butter. Spoon peaches over batter. Sprinkle top with additional cinnamon and nutmeg.
Bake in preheated oven for 1 hour, or until knife inserted comes out clean.