►Biscuits: Heat oven to 325°F with a rack in upper third of oven. Line a rimmed baking sheet with parchment paper.

►Fry bacon over medium heat in a large, heavy skillet until crisp. Drain on paper towels, then crumble finely.

►Whisk together flour, baking powder, salt, and cayenne in a large bowl. Add chilled lard and cut into flour with a pastry cutter until texture resembles coarse meal. Add crumbled bacon, cheese, and milk and stir just until ingredients are well moistened.

►Transfer dough to a lightly floured surface and knead 4 or 5 times. Pat dough into a ½-inch-thick square and stamp out biscuits with a 2-inch biscuit cutter or rim of a glass. Pat scraps together and stamp out more biscuits. Place biscuits on prepared baking sheet ½ inch apart and bake until golden, 12 to 15 minutes.

►Gravy: While biscuits are baking, wipe out skillet used for bacon and crumble sausage into it. Cook over medium-high heat until no longer pink, about 10 minutes. Use a slotted spoon to transfer sausage to paper towel–lined plate. Leave drippings in pan.

►Reduce heat to medium-low. Whisk flour into pan drippings until combined. Continue to whisk and cook for another 2 minutes or so, until flour mixture is smooth and light brown. Season roux with salt and pepper, then stir in 3 cups milk.

►Return sausage to pan and cook gravy, stirring frequently, until it thickens, about 10 minutes. Season to taste with salt, pepper, nutmeg, and cayenne. If gravy gets too thick, add up to 1 cup more milk, 2 tablespoons at a time, to achieve desired texture. Taste and adjust seasoning as necessary.

►To serve: Split biscuits and top with sausage gravy. Garnish with chopped scallions, fried eggs, and/or additional smoked cheddar cheese.