Heat milk in a large saucepan - add cheddar cheese and cream cheese. Without bringing the mixture to boil, heat it gently, constantly stirring until all cheese is melted. If the sauce is too thick - add more milk. If the sauce appears too watery - it's OK. Once you add the pasta, the pasta will absorb some of the liquid, which will thicken the sauce.
In the mean time, cook elbow macaroni al dente - drain and rinse with cold water to stop the cooking. Add macaroni to the sauce and continue cooking the sauce with the pasta in it, on medium heat, for a couple of minutes stirring constantly to coat well.
Add cooked bacon (already chopped into small bits) and chopped jalapenos (from the can) and stir. Add more jalapenos if you like it spicier.
Only after you added bacon and jalapenos, you can season with salt and pepper if desired - do not add salt until this point because the bacon and the marinated jalapenos will bring saltiness to the dish.