Preheat the air fryer to 320°F. Grease or line an 8x8-inch air fryer-safe pan with parchment paper and lightly coat with nonstick spray; set aside. Peel and chop the 1 large green apple.
In a large bowl, beat together the ½ cup butter, ½ cup granulated sugar, ¼ cup brown sugar, 1 large egg½ tsp cinnamon, and 1 tsp vanilla extract until smooth and creamy. Mix in the 1 ½ cups all purpose flour, ½ teaspoon salt and 2 teaspoons baking powder until combined, then add the ¾ cup milk and beat until a smooth batter forms.
Spread half of the batter evenly into the prepared pan, then layer the chopped apples on top. For the crumb topping, combine the ½ cup butter, ¾ cup brown sugar, 1 cup all purpose flour and 1 teaspoon cinnamon in a medium bowl. Cut the butter into the mixture until crumbly and sprinkle half of it over the apples.
Spread the remaining batter evenly over the apples and initial crumb layer, then top with the remaining crumbs. Place the pan into the preheated air fryer and cook for 25–30 minutes, or until a toothpick inserted in the center comes out clean. Let cool slightly, then drizzle the glaze over the cake before serving.
To Make the glaze: Mix ¼ cup powdered sugar, ½ tsp vanilla, and 1 tsp milk, mix until smooth.