Mix sugar into the warm water until completely dissolved. Add yeast and mix until dissolved. Set aside and allow the yeast to activate for 5 minutes.
Once yeast has activated (it should begin to foam at the top) add melted butter and salt. Stir well.
Mix flour, powdered sugar and slowly fold in the liquid mixture. Mix together until a dough forms. Form the dough into a ball and cover the bowl with a kitchen towel. Let proof in a warm room until double in size (about an hour).
Preheat oven to 425 degrees F. Remove dough ball from the bowl and knead on a lightly floured surface until dough is no longer sticky.
To create pretzels roll out a log of dough and press flat.
For filling mix cream cheese, cheddar cheese, and green onion. Spoon out a small amount of mixture on the flatten dough. Pinch dough closed and roll back into a log. Cut the log into bite sized pieces and pinch the ends closed.
To create a nice brown crust bathe each pretzel in a baking soda bath before baking. Do this by adding 2 tbsps baking soda to 2 cups boiling water, and submerging the pretzels for 30 seconds each.
Bake pretzels for 8-10 minutes until browned. If you wish garnish pretzels with rock salt.