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In a large bowl, combine the flour, sugar, baking powder and salt.
In a separate bowl, whisk together the melted butter, egg and vanilla.
Add the wet ingredients to the dry ingredients, and mix well until the mixture is crumbly.
Add water gradually, mixing into the dough. Knead until you form a firm ball. Let the dough rest, covered, for 30 minutes.
Use a dough scraper to divide the dough into 18 pieces. Shape each piece into a ball.
On a lightly floured surface, use a rolling pin to roll out each ball into a thin 6-inch circle. Repeat with remaining dough.
In a large cast-iron skillet with tall sides, heat oil over medium-high heat.
Fry dough circles one at a time, until puffed and golden, about 45 seconds on each side.
Use tongs to flip buñuelos and pull them from the oil. Place them on paper towels to strain, then sprinkle with cinnamon sugar immediately.
Serve as whole pieces or break into smaller pieces to share.