What I did was I let the final icing layer set at room temp for several hours prior to putting it in the fridge. I let it set overnight and then when I took it out I let it get to room temp (approx 1 hour) then cut with a paring knife.

The meringue powder is in the Cake/Wedding/Party section at Wal-mart / 2c sifted confectioners sugar, 4 tsp light corn syrup, 1/2 tsp vanilla, 4-6 tsp milk (start with 4, add more if necessary). The corn syrup allows the icing to dry to the touch and stay shiny, but it doesn’t get crunchy hard like Royal icing. Be sure to keep your icing covered when you are not working with it as it dries quickly. I usually mix small color batches in 8 oz margarine tubs.