Place onions in a large saucepan; add water to cover. Bring to boil; reduce heat, and simmer 6 to 8 minutes or until onions are just tender. Drain well. Set aside.
Melt 2 tablespoons butter in a heavy saucepan over low heat; add flour, stirring until smooth. Cook 1 minute, stirring constantly. Gradually add half-and-half; cook over medium heat, stirring constantly, until thickened. Add salt and next 3 ingredients. Add 1 cup shredded cheese; stir until cheese melts. Gently stir in drained onions. Pour onion mixture into a lightly greased 1-quart baking dish. Sprinkle evenly with remaining 1/2 cup shredded cheese.
Toss breadcrumbs with melted butter and thyme until crumbs are well coated. Sprinkle evenly over cheese.
Bake, uncovered, at 350° for 25 to 30 minutes or until thoroughly heated and top is golden.
*Pulse 3 bread slices in a mini food chopper or food processor. It should yield 1 1/4 cups breadcrumbs.