Combine caramels and milk in heavy saucepan. Cook over low heat, stirring occasionally until blended.
Combine flour, oats, nuts, brown sugar, soda and salt in a bowl, add melted butter, mixing until mixture resembles coarse crumbs. Reserve 1 cup of mixture and press remaining mixture into bottom of greased 9x13 pan. Bake at 350 degrees for 10 minutes.
Sprinkle 1 cup M&Ms on top of partially baked crust. Pour caramel mixture over M&Ms. Sprinkle reserved crumb mix and remaining 1/2 cup M&Ms on top. Continue baking for 20 to 25 minutes.
Cool slightly, then chill for 30 minutes. Cut into bars.