In a stand mixer bowl, combine 1 1/2 cup flour, yeast, sugar and salt; mix well.
In saucepan, heat water, milk and butter to 120-130°F; butter does not need to melt. Add to flour mixture. Add eggs. Using a paddle attachment, blend at low speed until moistened; beat 3 minutes at medium speed.
Switch to dough hook attachment. Stir in lemon rind, cherries and enough remaining flour to make a firm dough. Knead on floured surface until smooth and elastic, 5 to 8 minutes. (NOTE: For hand mixing: following above steps, mix ingredients in large mixing bowl using a wooden spoon or dough whisk. Knead on floured surface until smooth and elastic.)
Place dough in lightly oiled bowl and turn to grease top. Cover; let rise until indentation remains after poking dough with finger down to second knuckle, about an hour.
Punch down dough. Divide into 3 parts. Shape each third into a smooth ball. On greased large cookie sheet, place 3 balls together in shape of a cloverleaf. Cover; let rise in warm place until indentation remains after lightly touching.
Preheat oven to 375°F.
Bake for 30 to 35 minutes. If too dark, cover loosely with foil last 5 to 10 minutes of baking. Remove from cookie sheet; cool.
Prepare glaze: Mix powdered sugar, butter and enough milk to achieve desired consistency. Drizzle glaze on cooled breads. Garnish with chopped nuts and cherries, if desired.