In large mixing bowl combine ground beef, cereal, onion, green pepper, egg, salt, and pepper. Set aside.
In small bowl stir together remaining ingredients. Spoon 3 tablespoons of ketchup mixture into meat mixture and combine. Shape meat into six to eight meatballs. Place each meatball into the well of a muffin tin. Spoon the remaining ketchup sauce over each meatball.
Bake at 375 degrees for 30 minutes. Remove from pan and drain on paper towels before serving, if needed.