Combine bulgur and 2 cups water in a medium bowl. Let stand 30 minutes; drain bulgur through a fine sieve, pressing out excess liquid. Combine bulgur, lamb, and next 7 ingredients (through red pepper) in a food processor; process just until smooth. Cover and chill 30 minutes. Form lamb mixture into 20 (2 1/2-inch) football-shaped meatballs.
Heat oil in nonstick skillet over medium-high heat. Add meatballs to pan; cook 12 minutes, browning on all sides. Serve with sauce.
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