Beat butter and cream cheese in a bowl until smooth and fluffy.
Mix in the 2.5 tbsp sugar, salt, and vanilla until combined.
Add flour and stir just until a soft dough forms with no dry patches.
Divide dough into 3 disks, wrap each, and chill until firm, about 1 hour.
Combine walnuts, raisins, 1/4 cup sugar, cinnamon, and orange zest in a small bowl.
Preheat oven to 375°F. Line two baking sheets with parchment paper.
Roll one dough disk into a 10-inch circle on a lightly floured surface.
Spread about 4 tbsp apricot preserves thinly over the dough, leaving a small border.
Sprinkle a third of the nut mixture evenly and press lightly so it adheres.
Cut the circle into 12 wedges. Roll each wedge from the wide end toward the tip.
Whisk beaten egg with water. Brush rugelach and sprinkle with coarse sugar.
Bake 18–22 minutes until golden. Cool 10 minutes, then transfer to a rack.
Repeat rolling, filling, and baking with remaining dough. Dust with powdered sugar to serve.