Bring 2 Tbsp. butter, next 4 ingredients, and 5 cups water to a boil in a medium-size Dutch oven over medium-high heat. Gradually whisk in grits, and bring to a boil. Reduce heat to medium-low, and simmer, stirring occasionally, 1 1/2 hours or until thickened. Stir in cheese and remaining 2 Tbsp. butter until melted.
Serve immediately.
Quick-Cooking Creamy Cheddar Cheese Grits: Substitute 2 cups uncooked quick-cooking grits for stone-ground grits. Decrease water and milk to 4 1/2 cups each. Prepare recipe as directed, cooking grits 10 to 15 minutes or until thickened.