1. Lightly coat bottom of a 9 x 2inch square pan with nonstick cooking spray.
2. In a saucepan over medium heat, melt cheese and butter together, then add peanut butter and stir until smooth. Remove from heat; add vanilla and nuts.
3. Place confectioners sugar in a large bowl; set aside 1/4 cup. Pour cheese mixture over sugar. Stir until completely mixed. Candy will be very stiff.
4. Using your hands, remove candy from bowl and press evenly and firmly into prepared pan. Pat top of candy with a paper towel to remove excess oil. Place pan in refrigerator until candy is firm, about 1 hour. (Fudge will keep, covered with plastic wrap, for up to 1 week.)
5. In a small bowl, stir together reserved 1/4 cup confectioners sugar and 1 teaspoon water until thick drizzling consistency. Transfer to a resealable plastic bag.
6. To serve, cut fudge into small squares, about 64 total. Top each with a small squeeze of drizzle.