I've used a very similar version of this recipe for years. It is WORLDS better than any prepackaged fondant you can buy, in ease of use, in taste, and especially economically. I've never added the extra vanilla, though I've occasionally added different flavoring oils. I've also never used the butter in this recipe, with no problems. A tip: If you need colored fondant, add the color to the hot marshmallow mixture before you start adding sugar. Otherwise you'll have to knead in the color later, which will result in technicolor hands and a potentially off texture. **Edit: Yesterday I used this recipe to make chocolate fondant. I added Americolor chocolate brown color to the melted marshmallows, and I also kneaded in about 1/2 cup sifted cocoa with the confectioner's sugar. After coating with shortening, wrapping in plastic and allowing to sit overnight, it was a bit dry, but water didn't help; I had to knead in some extra shortening to get it to a good texture (which didn't take long). Instead of dusting the countertop with confectioner's sugar when rolling it out, I just greased it with a little bit of shortening - it prevented sticking and gave the fondant a nice shine.
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I've used a very similar version of this recipe for years. It is WORLDS better than any...