Combine 2 cups flour, undissolved yeast, sugar and salt in large mixer bowl. Heat water, milk and butter until very warm (120° to 130°F) and add to flour mixture. Beat 2 minutes at medium speed of electric mixer, scraping bowl occasionally. Stir in 1 cup flour; beat at high speed for 2 minutes, scraping bowl occasionally.
Stir in enough remaining flour to make soft dough. Knead on lightly floured surface until smooth and elastic, about 8 to 10 minutes. Cover; let rest 10 minutes.
Divide dough in half; roll one half to 12 x 7-inch rectangle. Beginning at short end of rectangle, roll up tightly as for jelly roll. Pinch seams and ends to seal. Place, seam side down, in greased 8-1/2 x 4-1/2 inch loaf pans. Repeat with remaining dough. Cover; let rise in warm, draft-free place until doubled in size, about 1 hour.
Bake at 400°F for 25 to 30 minutes or until done. Remove from pans; cool on wire rack.