Heat together the milk and water until it is very warm, but not hot to the touch. Add the yeast and 2 tablespoons of sugar. Leave to get foamy - about 2 minutes.
Use your stand mixer with the whisk attachment to beat together the eggs sugar, and vanilla until light and fluffy.
Add in the oil and salt and mix to combine.
Stir in the yeast mixture and mix until just combined.
Replace the whisk attachment with the dough hook, then begin to mix in the all-purpose flour on low speed. Once the mixture starts to combine, knead on medium-high for 8 - 10 minutes
Lightly grease a large bowl and place the dough inside. Allow to double in size - about 30 minutes. While it is rising mix together the ingredients for the cinnamon sugar mixture in a bowl.
Heat oil in a very large Dutch oven until it reaches 325 degrees F.
Evenly divide the dough into 8 pieces. Roll out one piece at a time until it forms a large, thin disc.
Fry on both sides until golden brown. About 5 - 6 minutes per side.
Remove and place on a wire rack double lined with paper towels to catch the excess oil.
While the doughnuts are still hot, toss with the cinnamon sugar mixture.