1. In large bowl stir together egg, cereal, milk powder, 1/4 cup onion, ketchup, salt and 1/4 teaspoon pepper. Add turkey. Mix well.
2. Using level measuring-tablespoon for each, shape meat mixture into meatballs. Place in single layer in greased or foil-lined shallow baking pan. Bake at 400°F about 18 minutes or until no longer pink in center.
3. For sauce, in medium saucepan combine tomato sauce, water, ketchup, brown sugar, 1/4 cup onion, relish, Worcestershire sauce, vinegar and 1/4 teaspoon pepper. Cook, covered, over medium heat about 15 minutes or until gently boiling.
4. Stir hot meatballs into sauce. Serve over rice or noodles, if desired.
MICROWAVE DIRECTIONS: Prepare meatballs according to above directions. In 11 3/4 x 7 1/2 x 1 3/4 microwave-safe baking dish place half of the meatballs. Micro-cook at HIGH (100% power) 5 minutes or until no longer pink in center, turning meatballs after 2 1/2 minutes. Drain. Repeat with remaining meatballs. For sauce combine all ingredients in 2-quart microwave-safe casserole. Microwave 5 minutes and stir. Add meatballs. Microwave 2 minutes or until heated through.