You're trying to make homemade sweetened condensed milk. Unsweetened condensed milk is called evaporated milk. And yes, use whole milk unless the recipe specifies otherwise.
Many older recipes called for you to scald milk, that is, to bring it nearly to a boil (185°F, 85°C, or more), preferably in a thick-bottomed pan, and stirring actively, to keep a protein skin from forming on the surface and keep the proteins and natural sugars in the milk from sticking to the bottom. Scalding served two purposes, to kill potentially harmful bacteria in the milk, and to destroy enzymes that keep the milk from thickening in recipes. Pasteurization, however, accomplishes both of those goals, and since almost all store-bought milk in Western countries is pasteurized these days, scalding is essentially an unnecessary step. But, in your case, you probably want to do it to get the milk up to temp.
Okay, back to evaporating the milk ... what you want to do is reduce the water content by about 60% - and cow's milk is about 87% water. So, skipping the math, you basically want to reduce the milk by at least 50% - ie reduce 1-cup milk to no more than 1/2 cup.
And, since you're making a reduction - you don't want to put a lid on it, and stir it frequently while it's reducing. The more it reduces the more frequently you want to stir it to keep if from scourching.
If you are adding the sugar to the milk after it is reduced it will be more grainey than if added at the beginning before reduction.
Substitution: Replace the total amount of milk with 1/2 that amount of evaporated milk ... heat and add the sugar.