1. Microwave butter and marshmallows in a lightly greased large microwave-safe bowl at HIGH 3 minutes, stirring after 2 minutes. Stir until smooth.
2. Stir in cereal, in batches, until well coated.
3. Coat hands with cooking spray. Shape warm mixture into 8 (4-inch) balls (about 1 cup each), lightly greasing hands as needed. Place balls on wax paper. Press 1 pretzel rod half, broken end down, into top of each ball. Let cool completely (about 30 minutes).
4. Microwave chocolate morsels in a microwave-safe bowl at HIGH 2 minutes, stirring after 1 minute. Stir until smooth. Let stand, stirring occasionally, 5 minutes. Drizzle chocolate over balls; sprinkle with sugar.
To make ahead: Wrap in plastic wrap, and store at room temperature for up to 2 days.