Step 1: Preheat your oven to 350°F (175°C) to ensure even baking.
Step 2: If using chorizo, heat a skillet over medium heat, add chorizo sausage and cook until browned, about 5-7 minutes.
Step 3: In a large mixing bowl, whisk together eggs, whole milk, kosher salt, black pepper, smoked paprika, and cayenne pepper.
Step 4: Remove the crusts from the white sandwich bread and cut into cubes.
Step 5: In a greased baking dish, layer half of the bread cubes, then spread green chilies, followed by half of the cheeses. If using chorizo, add half over the cheese. Repeat layering.
Step 6: Pour the egg mixture over the layers, pressing the bread down gently.
Step 7: Cover with foil and let sit for 20-30 minutes for absorption.
Step 8: Remove foil, sprinkle extra smoked paprika, and bake for 45-55 minutes until set and golden brown.
Step 9: Allow to cool for a few minutes before serving warm with toppings.