Heat oil in 12-inch skillet over medium heat; sauté onion, garlic and mushrooms for 3 to 5 minutes, stirring occasionally. Add half & half and milk, season with salt, pepper and nutmeg. Cook for 10 minutes, stirring occasionally.
Meanwhile, cook pasta according to package directions. Pre-heat oven to 425 degrees F. Spray a 9x9 baking dish with nonstick cooking spray.
Toss pasta and sauce together. Add cheeses and optional hot dog slices; stir until well blended and pour into casserole dish. Top with Parmesan.
Bake uncovered for 20 minutes or until golden brown. Let cool for 5 minutes before serving.