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Reserve 1/2 cup of the 8 ounces chopped chocolate; cover and set aside. Stir together remaining chopped chocolate, water, sugar and milk in a medium saucepan. Bring to a boil, whisking constantly. Boil gently for 1 minute. Remove from heat; stir in vanilla. Cover and chill overnight.
Stir the reserved 1/2 cup chopped chocolate into the chilled chocolate mixture. Freeze mixture in a 1-quart ice cream freezer according to the manufacturer's directions. Allow to firm up in freezer for 4 hours before serving.
To serve, scoop into small glasses or dishes. If desired, chop the 1 ounce chocolate; sprinkle over individual servings.