Cheesy Baked Grits

In 3-quart saucepan, heat margarine, salt, 1 1/2 cups milk, and 2 cups water to boiling over medium-high heat. Beating constantly with wire whisk to prevent lumping, gradually stir in grits. Reduce heat to low; simmer 5 minutes, stirring occasionally. Remove saucepan from heat; stir in cheeses. In large bowl, with wire whisk or fork, mix eggs, hot pepper sauce, and remaining 2 cups milk until blended. Gradually stir grits mixture into egg mixture. Preheat oven to 325 degrees F. Grease shallow 2 1/2-quart casserole or glass baking dish. Pour grits mixture into casserole. Bake, uncovered, 50 minutes or until knife inserted in center comes out clean.