Dotti Jo Meatballs with Spinach and Mushroom Cream Sauce

I got this recipe from a lady in my ward during a Relief Society recipe exchange night. They are called "Dotti Jo meatballs" after her mother-in-law who gave her the recipe. It is a super easy, somewhat healthy (as healthy as meatballs can get), and one of my family's favorite meals. The original recipe called for a "milked down" can of cream of mushroom/chicken soup instead of the cream sauce, but lately I have been trying to get away from relying on canned stuff and making up my own versions of them. I like this cream sauce MUCH better than the canned stuff, if you have time to make it.

Meatballs
1 lb hamburger
1 small carrot, grated
1 small potato, grated
1/2 onion chopped fine
1/2 green bell pepper chopped fine
salt and pepper to taste
1-2 Tb. cornstarch
2 Tb. oil

Heat oil in a large skillet or wok on medium-high heat. Mix all remaining ingredients together with hands. Make small golfball sized meatballs, adding more cornstarch if needed to hold them together. Brown in hot skillet with lid on. Turn as needed for even cooking. Drain on paper towel and serve over rice or noodles with spinach and mushroom cream sauce or desired canned creamed soup.

Spinach and Mushroom Cream Sauce
2 cups milk
2 Tb. butter
2 Tb. flour
small slice of onion
a few peppercorns
2 bay leaves
nutmeg
salt and pepper
1/2-1 cup fresh sliced mushrooms
1/4-1/2 cup fresh chopped spinach

* 1. Place the milk, onion, peppercorns, and bay leaves into a medium saucepan and heat to just before boiling point. Remove the pan from the stove, cover with a lid and set aside for 20 minutes to allow the flavors to infuse. Strain the mixture using a sieve and discard the onion, bay leaf, and peppercorns.
              * I got this from a fancy recipe, so you may be able to skip this step, although I think these ingredients probably add a lot of flavor in the sauce.
2. Using the same saucepan, melt the butter and then add the flour. Stir continuously and cook for 1 minute making a "roux" or paste.
3. Remove the pan from the heat and whisk in a little of the milk at a time until it has all been used up. Season with the salt and pepper and add nutmeg as desired.
4. Return the pan to the heat and bring the sauce to a boil, whisking continuously until it begins to thicken. Add the mushrooms and spinach. Reduce the heat and cook for several minutes, stirring constantly until the sauce reaches the desired consistency.