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Preheat oven: Preheat oven to 350°F.
Melt butter: Melt butter in a 10-inch cast-iron skillet, preferably enameled, over medium heat.
Sprinkle peaches with sugar: Meanwhile, place peaches in a large bowl and sprinkle with 2 tablespoons granulated sugar.
Whisk batter; top with peaches in skillet: In another large bowl, whisk together flour, baking powder, and salt. Add remaining 1 cup granulated sugar, milk, and vanilla; whisk until well combined. Whisk in melted butter. Pour mixture into skillet and top with peaches. Sprinkle with sanding sugar.
Bake and serve: Bake until top is golden brown and a tester inserted in center comes out clean, 50 to 55 minutes. Serve warm or at room temperature with whipped cream, creme fraiche, or ice cream, if desired.