Press squash between several layers of paper towels to absorb excess moisture. Fluff squash with a fork, and toss with 2 tablespoons flour; set aside.
Lightly spoon 1 1/2 cups flour into dry measuring cups; level with a knife.
Combine flour, baking powder, and salt in a bowl; set aside.
Beat butter with a mixer at medium speed until creamy; gradually add granulated sugar.
Add eggs, and beat at medium speed just until blended.
Combine yogurt and milk in a small bowl.
Add flour mixture to sugar mixture alternately with yogurt mixture, beginning and ending with flour mixture. Stir in squash and lemon rind. Spoon batter into an 8 x 4-inch loaf pan coated with cooking spray.
Bake at 350 for 55 minutes or until a wooden pick inserted in center comes out clean. Cool in pan on a wire rack 10 minutes; remove from pan. Cool completely on a wire rack.
Combine lemon juice and powdered sugar, stirring with a whisk; pour over loaf.
