HEAT oven to 325ºF. Beat butter and sugar in large bowl until combined. Add water and vanilla; beat well. Stir in flour and nuts. Chill dough 30 minutes.
SHAPE dough into 2 1/2-inch circles, using about 1 tablespoon dough for each. Top each with 1 teaspoon of mincemeat. Shape dough around mincemeat.
PLACE cookies, seam sides down, on ungreased baking sheets. Bake 20 minutes or until bottoms are lightly browned. Cool on wire racks.
PLACE powdered sugar in plastic food storage bag. Add cookies, a few at a time, and shake gently until coated. Store leftovers covered in refrigerator.
