Preheat a deep fryer to 365 degrees F or set up a heavy, deep pot for frying by filling it with at least 3-inches of vegetable oil.  

In a large sauté pan, melt the butter. When the butter is melted, add the onions and sauté for about 2 minutes, or until translucent and soft. Season with salt and pepper. Stir in ¼ cup plus 2 tablespoons of the flour to make a blond roux. Cook for 1 to 2 minutes, then whisk in the milk little by little to form a smooth sauce. Return to medium heat and cook until the sauce is thick and creamy. Season with salt, pepper, nutmeg, parsley and sherry. Stir in the ham. Mix well and cook for 4 to 5 minutes over low heat. Pour the mixture into an 8 by 8 1/2-inch baking pan and cool in the refrigerator so that the mixture will be easy to handle. Refrigerate until well-chilled, at least 2 to 3 hours and up to overnight.

In a small mixing bowl, beat the eggs with water until frothy and pour into a medium bowl. Combine the bread crumbs and the remaining flour (1/4 C plus 2T) in a second bowl. Season the breadcrumb mixture with salt and pepper. Using your hands, shape the ham mixture into logs about 3/4-inch thick. Using a knife, cut the logs into 1 1/2-inch long pieces. Dip the logs in the egg wash, letting the excess drip off. Roll the logs in the seasoned breadcrumb-flour mixture. Place the logs on a baking sheet and cover with plastic wrap. Refrigerate the logs until you are ready to serve, up to several hours in advance. 

When you are ready to serve them, fry the croquettes in the hot oil, a few at a time, until golden brown, about 3 to 4 minutes. Remove the croquettes from the oil and drain on a paper-lined plate. Season the croquettes with salt and pepper. Serve the croquettes with lemon wedges and garnish with chopped parsley.