In a large bowl, combine 1 cup of flour with the sugar, salt, and dry yeast. Add milk and softened butter or margarine. Stir in the starter. This will create a runny yet well-combined mixture.
Add the remaining 3 3/4 cups flour gradually, you may need more depending on your climate and ingredients.
Turn dough out onto a floured surface then knead for 8 to 10 minutes. Place in a greased bowl, turn once to oil surface, and cover. Allow the dough to rise for 1 hour, or until doubled in volume.
Punch down the dough then let rest for 15 minutes.
Egg Wash
Whisk together the egg and water until smooth and a little frothy.
To Bake
Form the sourdough into two loaves and place them in the Dutch oven. Brush top with egg wash. Allow it to rise for another 1 hour, or until doubled.
Bake at 375 degrees F (190 degrees C) for 30 minutes, or until golden brown.