Prepare the Dough:
In a large mixing bowl, combine hot water and 1 teaspoon of sugar. Sprinkle yeast on top and stir. Let it sit for about 5 minutes to proof.
In a microwave-safe bowl, heat milk, butter, and the remaining sugar until the butter is melted. Stir the mixture and let it cool slightly (warmer than room temperature, but not hot enough to kill the yeast).
Add the butter mixture to the yeast mixture and stir. Whisk in the egg and salt.
Form the Dough:
Gradually add flour in 1/2 cup increments, stirring to combine until a dough forms. Knead for 2-3 minutes, adding more flour as needed, until the dough is slightly sticky.
Let the Dough Rise:
Place the dough in a bowl, cover it with plastic wrap, and let it rise in a warm, draft-free spot for about 1 hour, or until it doubles in size.
Shape the Dough:
Punch the dough down and divide it into 8 equal pieces. Roll each piece into an oval, 1/4 to 1/8 inch thick.
Fry the Dough:
Heat oil in a deep fryer or skillet to 350°F. Carefully place one piece of dough in the oil and fry for 20-30 seconds on each side, until golden brown. Use tongs or a slotted spoon to press the middle of the dough into the oil for even cooking.
Add Toppings:
Remove the fried dough from the oil and let the excess drip off. Immediately coat in cinnamon sugar or transfer to a paper towel to drain and spread Nutella or other toppings of your choice. Serve warm for the best flavor.