Saute onion and celery in butter in 1-quart heavy saucepan until tender, about 5 minutes. Remove from heat and stir in remaining ingredients. Bring to a boil, stirring frequently. Simmer, uncovered, 15 minutes.
Preheat oven to 325°F. Chop cabbage coarsely. Cook in salted boiling water, uncovered, 5 minutes; drain. Combine bread crumbs, dry milk, water, salt, and pepper in a large mixing bowl. Mix in meat.
Pat half of the meat mixture into bottom of an 8 in. square baking pan. Combine cabbage and half of the cheese. Spread over meat. Top with remaining meat mixture. Spoon sauce over all.
Bake 55-60 minutes. Remove from oven and sprinkle the rest of the cheese. Let stand for 10 minutes before serving.