Heat oven to 350º F. In a medium skillet, over medium heat, heat the oil with the onion, garlic, and jalapeño and cook until the vegetables are tender but not browned, about 10 minutes. Add the salt, oregano, and nutmeg. Remove from heat.
In a large bowl, whisk the eggs, then blend in the milk, and bread crumbs. Add the meat and cooked vegetables and stir or work with your hands to combine. Shape into 1 1/2-inch balls. sauté over medium-high heat, in olive oil, a few meatballs at a time. Remove them when they are well browned on all sides. Pour off the fat and return the meatballs to the skillet. Top with marinara sauce. Simmer over low heat 10 minutes. Serve half the meatballs over cooked spaghetti. Reserve the remaining meatballs for subs.