Meanwhile, in 2-quart saucepan, mix sugar and cornstarch. Add cranberries and orange juice. Heat to boiling over high heat. Reduce heat to medium. Cook 7 to 8 minutes, stirring frequently, until mixture is thick and all cranberries have popped open. Stir in orange peel and 1/8 teaspoon nutmeg. Serve warm cranberry sauce with cake.