PLACE PECANS AND 1/4 CUP BUTTER IN A BAKING PAN. BAKE AT 350° FOR 10-15 MINUTES OR UNTIL TOASTED, STIRRING FREQUENTLY; SET ASIDE.
IN A LARGE BOWL, CREAM SUGAR AND REMAINING BUTTER UNTIL LIGHT AND FLUFFY. ADD EGGS, ONE AT A TIME, BEATING WELL AFTER EACH ADDITION. STIR IN VANILLA. COMBINE THE FLOUR, BAKING POWDER AND SALT; ADD TO THE CREAMED MIXTURE ALTERNATELY WITH MILK, BEATING WELL AFTER EACH ADDITION. STIR IN 1-1/3 CUPS OF TOASTED PECANS.
POUR INTO THREE GREASED AND FLOURED 9-IN. ROUND BAKING PANS. BAKE AT 350° FOR 25-30 MINUTES OR UNTIL A TOOTHPICK INSERTED IN CENTER COMES OUT CLEAN. COOL FOR 10 MINUTES BEFORE REMOVING FROM PANS TO WIRE RACKS TO COOL COMPLETELY.
FOR FROSTING, CREAM BUTTER AND CONFECTIONERS’ SUGAR IN A LARGE BOWL. ADD MILK AND VANILLA; BEAT UNTIL SMOOTH. STIR IN REMAINING TOASTED PECANS. SPREAD FROSTING BETWEEN LAYERS AND OVER TOP AND SIDES OF CAKE.