Make the panade: Place torn bread in a small bowl. Pour the milk over and let soak 5 minutes. Mash together with a fork into a rough paste.
Combine the meatball mixture: In a large bowl, add ground beef, sausage, soaked breadcrumb paste, egg and yolk, cheese, garlic, parsley, Italian seasoning, salt, and pepper. Mix with your hands until just combined — do not overwork. Test by cooking a small piece in a hot pan; taste and adjust seasoning in the raw mixture before rolling.
Roll the meatballs: With damp palms, roll mixture into balls about 1½ inches across. You should get 24–28 meatballs.
Sear: Heat olive oil in a large heavy-bottomed pot or Dutch oven over medium-high. Working in batches, brown the meatballs on 2–3 sides, about 2 minutes per side, until a dark crust forms. Do not crowd the pan. Transfer to a plate — they don't need to be cooked through yet.
Make the marinara: In the same pot, reduce heat to medium-low. Add olive oil, minced garlic, and red pepper flakes. Cook, stirring, for 90 seconds until fragrant. Add the hand-crushed tomatoes and all their juices. Stir and season with salt. Raise heat to medium and simmer uncovered for 15–20 minutes, until the sauce thickens and deepens in color.
Simmer together: Nestle the browned meatballs into the sauce, spooning sauce over each one. Reduce heat to low, cover, and simmer 20–25 minutes until meatballs are cooked through.
Finish and serve: Tear fresh basil over the top. Serve over pasta with grated Parmesan, or with crusty bread for a simpler presentation.