Heat water, butter, salt, sugar, oil, vanilla extract and nutmeg to a rolling boil. Stir in flour. Stir vigorously over low heat until mixture forms a ball (about one minute). Remove from heat. Beat eggs in all at once. Continue beating until smooth. Let the dough cool. Place dough in a piping bag with a star tip. In a large frying pan, heat corn oil. Pipe the churros in long rods directly into the hot corn oil. Fry until golden brown on all sides. Dust with Cinnamon Sugar and serve with Chocolate Caliente.
In a small bowl, mix sugar and cinnamon together and store in an airtight container.
Bring milk to a boil. Add in chocolate and sugar. Stir over heat until chocolate is melted and sugar has dissolved.