In a large saucepan, combine sugar and tapioca. Add one package of raspberries; stir to coat. Let stand for 15 minutes.
Stir in the water, cinnamon stick, salt and nutmeg. Bring to a boil over medium heat, stirring occasionally. Remove from the heat. Add lemon juice and butter; stir until butter is melted. Cool for 20 minutes.
Discard cinnamon stick. Gently stir in remaining raspberries. Cover and refrigerate until chilled. Serve with ice cream.