Smothered Steak

Cook bacon in 1 tablespoon oil in a large heavy skillet over medium heat until crisp. Drain on paper towels, reserving fat in skillet, then crumble.
Meanwhile, pound steaks 1/4 inch thick between sheets of plastic wrap using flat side of a meat pounder. Snip through any gristle with kitchen shears (to prevent curling), then pat steaks dry.
Mix together flour, 1 teaspoon salt, and 1/4 teaspoon pepper and dredge steaks on all sides, shaking off excess.
Heat reserved bacon fat over medium-high heat until it shimmers, then brown steaks on both sides in batches; transfer to a plate.
Add onion to skillet with remaining tablespoon oil, 1/4 teaspoon salt, and 1/8 teaspoon pepper and cook over medium heat, stirring frequently and scraping up brown bits, until softened and browned, about 10 minutes.
Add steaks with any meat juices and water and bring to a boil. Simmer, tightly covered, over low heat until meat is very tender, about 1 1/4 hours. If sauce is thin, transfer meat to a platter and boil until reduced to about 1 cup. Season steaks with salt and pepper. Serve with sauce and sprinkled with bacon.