Step 1: Preheat your oven to 350°F (175°C). Grease and flour two 9-inch round cake pans, or line with parchment paper.
Step 2: In a medium bowl, whisk together the all-purpose flour, baking powder, and salt. Set aside.
Step 3: In a large bowl, using an electric mixer, cream together the softened butter and granulated sugar until light and fluffy, about 3-5 minutes.
Step 4: Add the eggs one at a time, beating well after each addition. Stir in the vanilla extract.
Step 5: Gradually add the dry ingredients to the wet ingredients in three additions, alternating with the coconut milk. Begin and end with the dry ingredients. Mix on low speed just until combined, being careful not to overmix.
Step 6: Gently fold in the shredded unsweetened coconut.
Step 7: Divide the batter evenly between the prepared cake pans. Bake for 28-32 minutes, or until a wooden skewer inserted into the center comes out clean.
Step 8: Let the cakes cool in the pans on a wire rack for 10-15 minutes before inverting them onto the wire rack to cool completely.
Step 9: While the cakes cool, prepare the glaze. In a small bowl, whisk together the powdered sugar, coconut milk, and vanilla extract until smooth. If the glaze is too thick, add a tiny bit more coconut milk; if too thin, add a bit more powdered sugar.
Step 10: Once the cakes are completely cool, drizzle the coconut glaze over the top of both layers, allowing it to drip down the sides. Stack the glazed layers or serve as individual cakes. Garnish with additional shredded coconut if desired.