Bring a large pot of salted water to a boil. Add the elbow macaroni and cook according to package directions until al dente, about 6-8 minutes. Drain in a colander, reserving 1/2 cup of pasta water. Set aside.

In a large Dutch oven or heavy-bottomed saucepan over medium heat, melt the butter. Once foamy, whisk in the flour and cook, whisking constantly, for 1-2 minutes until the mixture is lightly golden and smells nutty. This is your roux.

Slowly whisk in the milk, ensuring no lumps form. Increase heat to medium-high and continue to whisk until the sauce thickens and coats the back of a spoon, about 5-8 minutes. Remove from heat.

Stir in the mustard powder, smoked paprika, garlic powder, nutmeg (if using), salt, and pepper. Return the pot to low heat if needed, but do not let the sauce boil. Gradually add the shredded cheddar and Gruyere, stirring until fully melted and the sauce is smooth.

Fold the cooked pasta into the cheese sauce, stirring until all pieces are evenly coated. If the sauce is too thick, add a few tablespoons of the reserved pasta water to reach your desired consistency. Serve immediately.