Prepare pasta according to package directions; drain.
Mix picante sauce, tomato sauce and water in small bowl. In a skillet, cook onion and ground beef in oil over medium heat until meat is browned and onion is tender (if using non-stick skillet, use only 1 teaspoon of vegetable oil). Remove from heat and drain off fat. Add chili powder, chopped green chilies, 1/2 cup shredded cheese and 1/2 cup picante sauce mixture to meat mixture.
Preheat oven to 350-o F. Pour half of remaining picante sauce mixture in bottom of 13 x 9 x 2-inch baking dish. Fill each cooked shell with 1 to 2 tablespoons of mixture and place shells in baking dish. Pour remaining picante mixture over top of shells. Cover with aluminum foil and bake at 350 -o F for 20 to 30 minutes. Uncover, add remaining 1/2 cup cheese and bake, uncovered, an additional 5 minutes until cheese melts. Serve immediately.
* This recipe can be assembled and frozen. To bake, thaw at room temperature for 8 hours and bake as directed above.