In a small liquid measuring cup, add 1/4 cup of the water and whisk in the yeast and sprinkle the sugar on top. Set aside for 5-10 minutes until the yeast dissolves and turns creamy. This is called proofing or proving the yeast.
In a large mixing bowl, add both flours, butter, and salt. Using your hands or a pastry cutter, mix until combined breaking up the butter into pea-sized pieces. Do not overwork the butter - you don't want it to melt.
Stir in the prepared yeast, 1 cup of the remaining water, grated cheese and dried jalapenos. Mix with your hands or a wooden spatula until the cheese and jalapenos are incorporated. The dough should be soft, but not too wet. If the dough is dry, add in a little of the remaining water - about 2 teaspoons at a time.
Use the dough to clean the sides of the bowl, then turn out onto a lightly floured surface. Knead the dough for 5-8 minutes. You will work the dough through the wet stage and knead until the dough is soft and smooth.
Transfer the dough to a lightly oiled bowl (olive oil is great), cover with plastic wrap and a dry dish towel, and place in a warm (room temperature) area to proof. You want the dough to double in size and depending on the temperature in your kitchen, it could take anywhere from 1-2 hours to rise.
Once the dough has proofed, pour out onto a lightly floured surface and cut into 4 approximately equal pieces. Shape each piece into an oval and transfer to the prepared baking sheets - 2 on each. Lightly dust the tops of each loaf with flour, then using a sharp paring knife, make a slash down the center of each loaf.
Cover the baking trays lightly with plastic wrap or put each in clean plastic proofing bags (if you have them). Large roasting bags work great for this and can be reused. Set aside for their second proof for 60 minutes, or until the loaves have doubled in size again.
While the loaves are proofing, preheat the oven to 450F degrees and place the oven racks in the top and bottom third of the oven.
When the loaves are done proofing, bake for 20 minutes or until the loaves are golden brown. Rotate the pans halfway through baking.
The loaves are best served warm! Store leftovers in a paper bag at room temperature for up to 2 days. The bread will get pretty stale after that.