Combine the meat,cream cheese,soup mix,salt,nutmeg,bread crumbs and 1/2c. of milk, Mix well. Shape into about 40 small balls. Brown lightly in large skillet. Cover and cook 20 to 25 mins, or until done.
Remove meat, drain off excess fat,leaving 1/4 cup in skillet. Blend flour into fat cooking about 1-2 min. stir in the 2c. of milk. Stir until gravy thickens.
Return meatballs to skillet cover and cook till heated through, serve over wide egg noodles or homemade mashed potato's. :)