Preheat your oven to 375°F (190°C) and lightly grease a 9x13-inch baking dish.
Heat olive oil in a large skillet over medium heat. Add the diced onion and sauté for 3-4 minutes until translucent.
Add the breakfast sausage, breaking it apart with a wooden spoon as it cooks. When the sausage is about halfway cooked (approximately 4 minutes), add the bell peppers and garlic. Continue cooking until the sausage is no longer pink and vegetables are softened, about 3-4 more minutes.
Sprinkle the cumin, chili powder, paprika, salt, and pepper over the sausage mixture. Stir in the diced green chilies and cook for another minute to allow the flavors to meld.
In a medium bowl, whisk together the eggs and milk until well combined. For fluffier eggs, whisk vigorously for 30 seconds to incorporate air into the mixture.
Layer 5 tortillas on the bottom of your prepared baking dish, overlapping slightly to cover the entire surface. Spread half of the sausage mixture evenly over the tortillas, followed by one-third of the shredded cheese.
Add another layer of tortillas, then the remaining sausage mixture, and another third of the cheese.
Pour the egg mixture evenly over the casserole, allowing it to seep into the layers. Gently press down with a spatula to ensure the eggs are distributed throughout.
Sprinkle the remaining cheese on top of the casserole. Cover with aluminum foil and bake for 25 minutes.
Remove the foil and bake for an additional 10 minutes until the cheese is bubbly and golden, and a knife inserted in the center comes out clean.
Allow the casserole to rest for 5 minutes before cutting. Serve with your choice of optional toppings.