In a large bowl, combine the turkey or beef, bread crumbs, egg substitute or egg, 1/2 teaspoon of the pepper, the Italian seasoning, and 4 tablespoons of the cheese. Form into balls the size of a golf ball.
Spray a large nonstick skillet with cooking spray and heat over medium heat. Working in batches, add the meatballs and cook for 15 minutes, or until browned and no longer pink inside. Remove to a bowl, leaving drippings in the skillet. Repeat to cook remainder of meatballs.
Using the same skillet in warm drippings over medium-high heat, add the onion and garlic and cook for 5 minutes, or until onion is tender. Stir in the zucchini, yellow squash, cut tomatoes (with juice), crushed tomatoes, the remaining 1/4 teaspoon pepper, the remaining 2 tablespoons cheese, and the meatballs.
Heat to boiling. Reduce the heat to low, cover, and cook for 20 minutes. Stir in the chopped basil.