Preheat the oven to 350 degrees. Grease an 8-inch square baking pan. In a 6-quart pot, bring the water and salt to a boil. Add the macaroni and cook for 7 minutes, stirring occasionally. Drain. Return the macaroni to the pot and stir in the butter or margarine until melted. Add 2 C. of the cheddar cheese. In a medium bowl, beat the eggs. Beat in the milk. Add the milk mixture to the pot with the macaroni. Stir until combined. Spoon into the prepared baking pan. Sprinkle the remaining 1/2 C. Cheddar cheese on top. Dust with paprika. Bake, uncovered, for 30 minutes or until the cheese has melted and the casserole is warm throughout.