Heat oven to 425°F; grease a rimmed sheet with teaspoon oil. Soak panko in milk 3 minutes; gently mix with beef, pork, egg, grated onion, meatball salt, paprika, thyme, cayenne, and pepper. Form 24 meatballs; bake 16 to 20 minutes until centers reach 160°F.
Meanwhile, heat 1 tablespoon gravy oil in a saucepan. Cook diced onion, pepper, and celery 7 minutes until soft; transfer to a bowl.
Add remaining gravy oil and flour. Stir constantly over medium 5 to 7 minutes until peanut-butter brown. Gradually whisk in broth; return vegetables and add gravy salt. Simmer 3 minutes.
Transfer hot gravy and meatballs to a 4-quart slow cooker. Cover; cook on HIGH 2 hours, gently turning once, until centers reach 165°F.
Near serving, boil grits water and salt. Whisk in grits; reduce to low. Cook 5 to 7 minutes, stirring often, until tender. Remove from heat; fold in butter and cheddar.
Divide grits among 6 bowls; top each with 4 meatballs and vegetable gravy. Serve while grits are soft.