Begin by freezing the kunafeh overnight. This will help it to stick together as you're handling it and ensure a crunchy texture. For the syrup: Combine the sugar and water and bring to a simmer, allowing all of the sugar to fully dissolve. Continue to cook the syrup down for around 5 minutes or until it reaches a honey-like consistency. Add the lemon juice and turn the heat off. Once off the heat, stir in the vanilla extract. Allow the mixture to cool completely and set aside.
For the kunafeh: Preheat the oven to 375 degrees F. Take the long strands of frozen kunafeh and place into a food processor, pulsing several times until shaved into short, soft pieces. (The texture and length should be similar to thin, shredded coconut.) Pour the shredded kunafeh into a bowl, and stir in the melted butter.
Combine the walnuts, sugar, cinnamon, pistachios and 2 tablespoons of the syrup, and set aside.
Put half of the kunafeh and butter mixture into a greased 10- by 10-inch baking dish (or a 12-inch round pastry dish) and press it down firmly with your hands, making sure all the edges are flat and even.
Pour the nut mixture evenly over the first layer of kunafeh. Take the second half of kunafeh and sprinkle evenly over the nut mixture, and then very carefully press the layer down with your hands as before, making sure you cover the entire nut layer with kunafeh.
Bake for 30 minutes or until golden brown.
Right after you take out the kunafeh, pour the cooled syrup evenly over the entire surface area. It's important you do this when the kunafeh is hot from the oven, so it will absorb all of the syrup.
Let it cool to room temperature and then place in the fridge to cool an additional 2 hours. For the prettiest results, invert the kunafeh on a large plate, cut and serve with creme fraiche or berries.
Bel hana well sheffah! (Bon appetite in Arabic)