In a big bowl, mix together flour, sugar, and salt. Make a well in the middle.
Pour in milk, beaten egg and melted butter into the well. Add the instant dry yeast to the liquid pool and stir using a wooden spoon within the well just to hydrate the yeast a bit.
From inside the well, stir outward to mix the dry ingredients to the wet ingredients until a sticky dough forms. Tip the dough on a floured surface and knead until it becomes smooth and elastic, about 8-12 minutes.
Form the dough into a ball and lightly coat with oil. Place it in a bowl and cover with a kitchen towel or plastic wrap and place it in a warm area and let it rise until it doubles in size. Depending how warm it is, it could take 30 minutes to an hour. Meanwhile, cut 16 pieces of 3x3-inch parchment or wax paper.
Punch down the dough and transfer to a lightly floured surface. Divide the dough into 16 equal pieces. Cover the pieces with a damp kitchen towel or plastic wrap so they will not dry out.
Form each piece into a smooth ball then place on a parchment paper. Lightly press it to flatten just a bit. Repeat with the rest of the dough. Cover with a kitchen towel and let them rise again to almost double.
Start to heat the oil in a wide pan over medium heat (160°C-170°C). Oil must be at least 1 ½ -2 inch deep. Fry in 3-4 batches, so it will not be overcrowded. Slide a piece of dough with parchment paper into the oil using a flat spatula or bench scraper. Fry until the bottom part is light golden brown then flip them over, and cook until the color of both sides evens out, around 3-5 minutes per batch. Just remove the parchment paper once it detaches from the dough or after turning it over.
Remove from oil using a strainer spoon and transfer to a baking sheet lined with paper towels. Let them cool down enough to handle.
In a wide bowl, run powdered sugar and cornstarch through a sieve. Set aside.