Take the road to Mason less than 10 miles (so just 10 minutes) to Hill Top Cafe, a roadhouse restaurant in an old timey gas station, opened in 1981. Check it out at http://www.hilltopcafe.com/
Going there is a great experience, worth the drive from Austin or San Antonio for a dinner excursion. The owners are a former Austin musician of Greek extraction (Johnny Nicholas) and his wife, whose Cajun credentials come from the Texas-Louisiana border. The cuisines of both are evident in the excellent food. Gumbo and po' boys at lunch; flaky spanokepitas, Greek salad or steak at dinner (from Johnny's influences) or Gulf shrimp, redfish, or whateverer came on from Port Aransas that week, from Brenda's side. Open ONLY Wed- Sun (lunch and dinner) and a great New Year's Eve destination in the middle of nowhere. I don't know of a place anywhere in Texas with better atmosphere. Johnny has played with so many famous bands, like Asleep at the Wheel -- and if you're there on a weekend night, he's likely to play some piano for you. Out of stater's will be wowed. Texans who haven't been are missing out.
Ate at the Cabernet Grill just south of F*burg last time I went on my wine tour. This place is great. I had the escargot and the Tejas mixed grill Dry Rubbed Tenderloin Tail, Jalapeno Quail & Smoked Pork Tenderloin Medallion with cabernet sauce. My wife had the lobster topped chicken fried steak with green chile cream gravy. The food quality was spot on. Warning- this place isn't cheap, but it is good.
Excellent burgers can be had at the Alamo Springs Cafe. If you go, also try their fried portabella mushrooms - they marinate them in red wine or something before battering and they are really tasty! http://www.alamospringscafe.com/
This is NOT a fancy place and it's about 15 minutes outside of Fredericksburg proper, but we like it. I've never had a great dining experience in Fredericksburg, to be honest. Avoid Der Lindenbaum at all costs!
The Nest, August E's, and Navajo Grill are capable fine dining joints (considering that you're in Fredericksburg), although August E's & Navajo Grill are both expensive. Also, all my sushi experiences at August E's have been mediocre and I recommend skipping that part of the menu. Lastly, there is Fredericksburg Herb Farm, which I can't recommend, and then a couple places out of town worth considering (Rose Hill Manor, Becker Vineyards).
The Nest is sort of Eastside Cafe-ish in atmosphere, with the added plus of having a full bar so you can kick things off with a martini. All my experiences there have been good, although in Austin you could go to Jeffrey's (or Wink) and have a better meal in a very similar cuisine vertical.
On August E's lunch menu only: Several years ago I had one of the best burgers of my life there, maybe the best burger I've ever had. I discussed it with the chef and found out that it was added to the menu as an afterthought - all the expensive steaks he had cut down had left him with trimmings that he used for a burger grind. Since then, repeat attempts revealed that result to be unusual. The burger is consistently good, but not amazing. Oddly enough the lunch menu now has a whole burger section.
Navajo Grill is a contemporary southwestern meets americana joint with a bit of Lonesome Dove (in Ft. Worth) thrown in for good measure. Not a terrible place to dine, especially if you're craving steak. I like the place.
Fredericksburg Herb Farm used to be a nice place with a lovely atmosphere and a very Eastside Cafe-esque menu. Changes there have warped the atmosphere and the food shows less love as well (although to be fair, food was never their strong suit). The depleted garden is especially sad for those who can remember what once was and superimpose it over the current vision. I mention this place only because it doubles as a spa, so if you want to get massages for your team that'd certainly be a memorable (weird?) meal.
Rose HIll Manor is a Green Pastures-ish place out of town. Really nice, plus you can stay there. Technically in Stonewall, I think. This would be a very expensive package.
Lastly, Becker Vineyards between 11 AM and 3 PM on a nice, cool day is absolutely wonderful. Bring some brisket from Franklin, Snow's, or Cooper's (put it in a cooler) along with all the fixings and have a picnic; also bring assorted olives and cheeses, strawberries, honey, pomegranate, etc. (Don't forget to bring paper towels and probably wet naps.) Buy six bottles of red and share around with your crew. People say brisket doesn't pair with wine, I say hogwash. Becker's capable and affordable wines will transport you to Europe and the setting on a crisp Autumn day with a clear blue sky will feel like Sonoma. On the right day, this is the most memorable dining experience I know of in Frederickburg, with the caveat that you have to bring your own food.
P.S. There were two other places that I really liked, Cuvee and Bon Terra. Both closed; Cuvee for business reasons, Bon Terra because the owner/chef passed away. Miss both these places and if anyone knows what the nice owner/chef from Cuvee is doing now, please let me know.
re: tom in austin
Of all the times I have eaten in F'burg, some of these places are new to me. I wish I had known about them before my travels there stopped. One place you didn't mention, and I think might be a good competitor for The Nest, is the place accross from the airport which I believe goes by the name "Cabernet". I ate there once and enjoyed the food although the portions served were absurdly huge.
Also there is a wine bar , garden type of place called, I believe, the Hickory Street Bar, that is good to kick back, drink a glass of wine or beer under an outdooor canopy. It is also WiFi'ed. For desert one can't beat, at least imo, R. Rather's bakery. The coffee there is passably good too.
re: tom in austin