In a medium skillet, toast coconut over medium heat until golden, stirring constantly. Remove from skillet and set aside.
Add pineapple, evaporated milk, butter, and sugar to the same skillet. Mix well and bring to a boil. Let boil 5 to 7 minutes; stir frequently. Return coconut to skillet and stir in nuts.
Slice cake in half horizontally. Spoon half of the pineapple mixture over bottom half of cake. Place remaining cake layer on top of pineapple mixture. Spoon the rest of the pineapple mixture on top of that layer. Garnish with cherries and whipped cream.
Slice and serve, or cover and keep chilled until ready. Makes 12 servings. Enjoy!
Note: Just add a scoop of low-fat frozen vanilla yogurt to serve this cake a la mode. Delicious!