Grease twelve 2-1/2-inch muffin cups or line with paper bake cups. Set muffin cups aside. In medium mixing bowl stir together flour, granulated sugar, the poppy seeds, lemon peel, baking powder, and salt. Make a well in the center of flour mixture.
In another medium bowl, combine milk, egg product, and oil. Add egg mixture all at once to flour mixture. Stir just until moistened (batter will be lumpy). Spoon batter into prepared muffin cups, filling each 2/3 full. Sprinkle tops with coarse sugar. Bake in a 375° oven for 20 to 25 minutes or until golden. Cool in muffin cups on a wire rack for 5 minutes. Remove from pans. Serve warm.
Traditional muffin recipes use lots of oil and eggs, making them high in fat. This recipe cuts the fat by using refrigerated egg product, fat-free milk, and just a small amount of oil. But the delicious flavor remains thanks to lemon peel and poppy seeds.