Yes, you can often do this substitution and I've done it successfully many times when I've run out of milk unexpectedly, but you should know that the substitution is never going to be perfect.
On a purely mathematical basis, let's say your heavy cream is 36% M.F. You need partially-skimmed 2% milk for your recipe. If you go purely by weight (which is almost 1:1 for volume when talking about mostly water), then 250 mL of 2% milk will contain about 5 g of milk fat. To get that from 36% cream, you only need about 14 mL, or approximately 3 teaspoons of cream. (Note - don't do this, read on!)
Of course, diluting cream at a ratio of 15:1 is ridiculous and you'll end up with something that's just really watery, and that's because milk is more than just water and fat. I only provide the above calculation for illustrative purposes, to show why there's no hard rule or even rule of thumb for this particular substitution.
With normal cream, most people go with half water, half cream, or if they're trying to approximate skim milk then maybe 1 part cream to 2 parts water. If you have double cream, I would probably use 1 part cream to 3 or 4 parts water; that will give you a reasonable approximation of the consistency of whole or skim milk without making it too watery.
Please keep in mind that different recipes/preparations use milk for different reasons, so this isn't going to work everywhere. I certainly wouldn't do it in baking, but for many stovetop recipes, the main purpose of the milk is just moisture, so you're fine to substitute cream + water and it doesn't really matter if you're "exact" - which you can't be anyway.
Don't reuse an old milk jug for storing the new, combined milk. The standard plastics used in milk jugs in most areas cannot be properly sanitized for reuse (even with standard sanitizing solutions).
Instead, use a properly sanitized and covered glass or plastic container, preferably one that you clean in a hot water dish washer. Milk stored in a properly cleaned container will have the maximum shelf life (and reduced chance of other contaminants).
Best Answer
If you want a fat fraction of f, starting from cream with a fat fraction c and milk with a fat fraction of m, then the fraction of cream to use is (f-m)/(c-m).
All you have to do is multiply that by the total volume to get how much cream to use, and then fill in the rest of the total with milk.
For example, if you want to approximate 1 cup of 3.25% whole milk using 36% heavy cream and 0% skim milk, you need (3.25-0)/(36-0) * 1 cup = 0.09 cups of cream, or 1.5 tablespoons. So take 1.5 tablespoons of cream, and add skim milk to reach 1 cup.
Or if you want two cups of 10.5% half and half using 33% whipping cream and 2% milk, you need (10.5-2)/(33-2) * 2 cup = 0.55 cups, or about 1/2 cup + 1 tablespoon of cream. So take 1/2 cup plus 1 tablespoon of cream, and add 2% milk to reach 2 cups.
Unfortunately it's hard to provide a really useful table of examples, because fat content of dairy products varies around from country to country, and even within countries. Probably the most useful single thing to know is that you can use Google, e.g. search for (10.5-2)/(33-2)*2 cups in tablespoons to do the calculation from the previous paragraph.
For example, in the US, I believe:
Resources for finding fat contents if not given:
Wikipedia on cream
US/UK conversions (the dairy section)
Derivation is pretty simple. If x is the fraction of cream, then the resulting fat fraction is:
f = x * c + (1-x) * m.
This is simply a weighted average of the component fat ratios: x is the fraction of cream, so 1-x is the fraction of milk. (If you really wanted to convince yourself of this, you could write out the amount of milk in each component and the total, and the volumes of everything, and divide to get this.)
Solving for x yields the formula given at the beginning of the answer.