Preheat oven to 350 degrees. For each coconut, use an ice pick (or a screwdriver) and a hammer to pierce the two softest eyes. Strain milk through a fine sieve into a bowl; reserve for another use or discard. Place coconuts on a rimmed baking sheet; bake for 30 minutes, or until shells begin to crack. Let cool enough to handle. Wrap each coconut in a clean kitchen towel; holding it with one hand, hit it with a hammer in the same place several times to split it into large pieces. Separate meat from shell, and use a vegetable peeler to remove dark outer skin. Rinse in cold water.
Grate enough coconut meat to make 1 cup. Cut remaining coconut meat on a mandoline into thin sheets; then slice into long, slim strips like fringe (you will need about 1 cup). Use immediately, or store, layered between damp paper towels in an airtight container, in the refrigerator for up to 6 hours.
Process grated coconut, flour, 1/2 cup confectioners' sugar, and the salt in a food processor to combine. Add butter and vanilla seeds; process until a dough forms.
Line a rimmed baking sheet with parchment paper. Roll 1 1/2-ounce pieces of dough into balls, and place on prepared baking sheet. Refrigerate until firm, about 30 minutes. Preheat oven to 350 degrees.
Bake cookies until bottoms turn a deep golden brown, about 30 minutes. Transfer to a wire rack, and let cool completely before icing.
To make icing, mix remaining 3 cups confectioners' sugar and the milk; stir in a few drops of food coloring. Place cookies on a rack over a parchment-lined baking tray. Spoon about 2 tablespoons of icing over one cookie at a time, coating completely. While still wet, cover with fringed coconut. Repeat with remaining cookies. Let dry at least 1 hour before serving.