Combine the hamburger, egg, cereal, onion flakes, salt and pepper to begin making the meatballs.
Make the ball size slightly larger than a golf ball. Use an ice cream scoop.
Bake the meatballs for 30 minutes in an oven pre-heated to 350 degrees.
While baking, make the sauce.
Combine sugar, dry mustard, ketchup and vinegar in a saucepan.
Heat and stir until well mixed.
After 30 minutes of baking the meatballs, remove from oven, pour sauce over meatballs and bake an additional 15 minutes.
When meatballs are done baking, you can cool and freeze for warming later, or enjoy right away.