Over medium-high heat, melt butter in a large, heavy saucepan. Add corn and onion; saute until onion is golden, about 10 minutes. Add water, milk, salt and pepper, then bring to boil. Gradually add grits in a steady stream while whisking and continue to whisk until mixture is smooth and returns to boil. Reduce heat to low and simmer until grits are thick and tender, whisking often, about 15 minutes. Mix in cheese and chipotle chiles, and stir until cheese melts.
Transfer grits to a shallow bowl to serve. Sprinkle cilantro over the top.