Preheat your oven to 350°F (175°C).

In a bowl, combine the finely chopped nuts and ground cinnamon. Set aside.

Unroll the phyllo dough and cover it with a damp cloth to prevent it from drying out.

Brush a 9x13 inch baking dish with melted butter. Lay down one sheet of phyllo in the dish and brush it lightly with melted butter. Repeat this process, layering and buttering each sheet, until you have about 8 sheets layered.

Evenly sprinkle a layer of the nut mixture over the phyllo.

Continue layering phyllo sheets, brushing each sheet with melted butter, followed by another layer of the nut mixture. Repeat until all nut mixture is used and top with about 8 more sheets of phyllo, brushing each with butter.

Using a sharp knife, cut the baklava into diamond or square shapes, cutting through the top layers of phyllo.

Bake in the preheated oven for about 45-50 minutes, or until the baklava is golden brown and crisp.

While the baklava bakes, prepare the syrup. In a saucepan, combine sugar, water, and honey. Bring to a boil, then reduce heat and let simmer for about 10 minutes. Remove from heat and stir in the vanilla extract.

Once the baklava is done baking, remove it from the oven and immediately pour the hot syrup over it, making sure to cover evenly.

Allow the baklava to cool completely before serving. If desired, dust with powdered sugar before serving.