In a small saucepan, combine cheddar cheese and cornstarch. Toss until cheese is evenly coated.
Stir in evaporated milk and salt. Heat over medium heat, whisking occasionally, until cheese is melted and smooth, about 3 to 5 minutes. Reduce heat to low, cover, and keep warm until serving time.
Notes
Cheese can be transferred to a slow cooker and kept warm
I found the best Pepper Cheddar Cheese (similar to pepper jack) at Costco. I know Trader Joe's carries a nice variety too. If you can't find a pepper infused cheddar, you can use plain cheddar and make it spicy with cayenne pepper, red pepper flakes, green chile, salsa, hot sauce, and/or chili powder
You can also replace some or all of the cheddar cheese with pepper jack.