Tex-mex chili meatballs with zesty tomato salsa

3 tb Vegetable oil
      1 sm Onion,diced,about 1/2 cup
    1/2 ts Chili powder
      1 lb Lean ground beef
      1 lg Egg
      1 cn (4 oz) mild green chilies,
           Drained and chopped
  1 3/4 c  Fresh bread crumbs, about 4
           Slices bread
    1/3 c  Shredded Monterey Jack
           Cheese
    1/3 c  Shredded mild Cheddar
           Cheese
    3/4 ts Salt
      6    Corn tortillas, half 10 oz.
           Pkg., cut into wedges
      1    Zesty Tomato Salsa
           Lettuce leaves, optional
           Tomato wedges, optional

-----------------------------ZESTY TOMATO SALSA-----------------------------
      1 tb Vegetable oil
      1    Red pepper, cored, seeded
           And diced (about 2 cups)
      1    Green bell pepper, cored,
           Seeded and diced (about 2
           Cups)
      1 md Onion, diced (about 3/4 cup)
      1 lg Clove garlic,crushed
      2 lg Ripe tomatoes, diced (about
           2 cups)
    1/2 ts Hot red pepper sauce
 
  Heat the oven to 400 degrees.In 12" skillet,over medium high heat, heat 1
  tbsp.  vegetable oil;add onion and chili powder;cook about 10
  minutes,stirring frequently,until onion is tender and coated with chili
  powder.Remove onion to large bowl;wipe skillet clean.To bowl with onion,add
  beef,egg,chilies,bread crumbs,1 tbsp. of each of cheeses and salt;using
  hands or wooden spoon,blend well.Shape mixture into 1 1/4" balls.In skillet
  over medium-high heat,heat remaining 2 tbsp. oil;add meat mixture;cook 15
  minutes,turning frequently,until well browned on all sides and cooked
  through.Meanwhile,place tortilla chips in single layer on jelly-roll
  pan;bake 10 minutes until crisp and golden.Prepare Zesty Tomato Salsa.To
  serve:Spoon meatballs into center of large serving platter;sprinkle with
  remaining Monterey Jack and Cheddar cheese.Arrange tomato wedges and
  lettuce around meatballs if desired.Serve with tortilla chips and
  salsa.Makes 4 servings. ZESTY TOMATO SALSA: In a 2 qt. saucepan over medium
  high heat,heat 1 tbsp.vegetable oil; add 1 each red and green bell
  pepper,cored,seeded and diced (about 2 cups),1 medium size onion,diced
  (about 3/4 cup) and 1 large clove garlic,crushed. Cook about 10
  minutes,stirring frequently,until tender.Stir in 2 large fresh,ripe
  tomatoes,diced (about 2 cups) and 1/4 to 1/2 tsp. hot red pepper sauce;cook
  1 minute longer until heated through. Makes about 1 1/2 cups.