In a large skillet, cook beef until brown. Drain off fat.
Stir in tomato sauce, basil, sugar, garlic powder, salt, and pepper. Bring to boiling. Reduce heat and simmer, uncovered, for 5 minutes.
Combine sour cream, cream cheese, milk, and onion. In a greased 2-quart casserole or an 8x8x2-inch baking dish, layer half the noodles, half the meat, half the cream-cheese mixture and all the spinach. Top with the remaining meat and noodles.
Cover; bake in a 350 degree F oven for 45 minutes. (Chill remaining cream-cheese mixture.) Spread with cream-cheese mixture. Top with the cheddar cheese.
Bake, uncovered, for 10 minutes more. Makes 6 servings.