Melt butter in a large skillet over medium heat. If you desire mild heat, sauté the jalapeno in this step for 1 minute. If you desire more heat, wait to add the jalapeno later.
Whisk in flour, and cook until it turns light in color and is bubbly, about 2 minutes.
Lower the heat to medium-low. Gradually stir in 2 cups of the half and half.
Once bubbles start to appear at the edge of the pan, add cheddar cheese and cream cheese. Allow them to melt, undisturbed, for 3 minutes, then stir until the mixture is smooth. Cook until the mixture slightly thickens, around 5 minutes.
If using fresh corn, cut the kernels off the ears. If using frozen or canned, thaw and/or drain.
Fold in the corn, jalapeno (if not previously added), sugar, and salt to the mixture. Cook for 5 minutes. Add the remaining half and half or milk to adjust the consistency, if needed.
Serve hot, and garnish as desired.