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Line one baking sheet with waxed paper. In large bowl, mix icing sugar, peanut butter, coconut and 1 ½ cups butter together until well blended. Gently fold in Rice Krispies* cereal until well coated. Form into 1 ½" balls). To make the rolling of balls easier, use lightly dampened hands. Refrigerate on baking sheet 30 minutes.
To make chocolate dip: In medium saucepan, over low heat melt chocolate chips, remaining butter and water together. If mixture is a bit thick for dipping add 1 to 2 tablespoons more hot water.
Using two forks, drop a couple of peanut butter balls in chocolate mixture. Roll balls around in chocolate mixture to coat in chocolate. Chill on waxed paper-lined baking sheet until chocolate is set. Other serving suggestions: peanut butter balls can be served plain or lightly drizzled with chocolate dip. To decorate balls with chocolate, use tip of spoon to drizzle chocolate over balls.