Can Apple Butter be substituted for Apple Sauce in baking?

Without having tried it, but knowing and loving both apple butter and apple sauce, I would say yes, but you should understand that apple butter has been oxidized longer than Apple sauce and it may produce a more bitter product.

I think it would be a fine substitution for making muffins because the sugar and moisture differences probably wouldn't be enough to throw off such a forgiving baked good. The flavor might be a bit different, but that could be good. I would not swap it in a more delicate pastry, but they probably wouldn't be made with applesauce anyway.

You start with apples, cook them a bit and you have apple sauce. Cook that sauce very slowly but for a long time and you get apple butter.

While I think the substitution would generally work, it most likely will be sweeter. Sweeter because there's less water in apple butter vs. apple sauce thus concentrating the sugars. Also the brown to dark brown color of apple butter is caramelization of the apple sugar. That caramelization has to change the taste of your muffins.

Give it a try and see what happens. Then make another batch with less sugar and see how they turn out. If your recipe uses brown sugar try changing some or all for white sugar using the apple butter as a kind of substitute. I suspect somewhere in those tests you'll find a batch that's great!

Late to the party here, but I would suggest that it could work IF you recognize that apple butter (at least the homemade kind) has been cooked longer to concentrate it and remove some of the moisture. In addition, it will have been sweetened more than applesauce (especially if the recipe calls for unsweetened applesauuce) and will also have added spices.

So...

If you substitute, take these adjustments into account: reduce the amount of spices in the recipe (you can taste your apple butter to check on what spices predominate in yours), cut the sugar by about a fourth or a third, and, if the batter seems very thick, add a teaspoon or so of water or whatever liquid is in your recipe.