Preheat oven to 350°F. Spray a 9x13-inch baking dish with cooking spray. Cut each biscuit into 6 pieces and arrange in the bottom of the dish. Set aside.
In a large skillet over medium-high heat, cook sausage until browned and crumbly, about 8-10 minutes. Don't drain the grease.
Sprinkle flour over the cooked sausage and stir to coat. Cook for 1 minute, stirring constantly.
Gradually add 2 cups of milk to the sausage mixture, stirring constantly. Add salt, 1/2 teaspoon black pepper, garlic powder, and cayenne if using. Bring to a simmer and cook until thickened, about 3-4 minutes. Remove from heat.
In a large bowl, whisk together eggs, remaining 1 cup milk, and remaining 1/2 teaspoon pepper.
Pour sausage gravy over the biscuit pieces, spreading evenly. Sprinkle with 1 cup of cheese. Pour egg mixture over everything, then top with remaining 1 cup cheese.
Bake for 50-55 minutes until eggs are completely set and top is golden brown. Cover with foil if top browns too quickly.
Let cool 10 minutes before serving. Garnish with chives. To freeze: cool completely, cut into squares, wrap individually in plastic wrap and foil, then freeze in a freezer bag for up to 2 months. Reheat in microwave for 3-4 minutes or in oven at 350°F for 25-30 minutes.