Place potatoes in a Dutch oven; add water to cover. Bring to a boil. Reduce heat; cook, uncovered, 15-20 minutes or until tender. Drain; transfer to a large bowl.

Mash potatoes. Stir in flour, eggs, bread crumbs, salt and nutmeg. Shape into sixteen (2-in.) balls.

In a Dutch oven, bring 12 cups water to a boil. Carefully add dumplings. Reduce heat; simmer, uncovered, 7-9 minutes or until a toothpick inserted in center of dumplings comes out clean.

Meanwhile, in a small heavy saucepan, heat butter and onion over medium heat. Heat 5-7 minutes or until butter is golden brown, stirring constantly. Remove from heat; stir in bread crumbs. Serve with dumplings.