Melt 1/4 cup butter in a large saucepan over medium heat. Whisk in flour, and cook, whisking constantly, 2 to 3 minutes or until flour is lightly browned. Whisk milk into butter mixture and bring to a boil. Reduce heat and simmer 6 minutes or until thickened. Stir in cheddar cheese and next 3 ingredients, stirring until cheese melts.
Spread a 1/4 cup of cheese sauce evenly into a lightly greased 13"x9" baking dish. Layer half the potatoes over the sauce. Top with half the remaining sauce. Repeat with remaining potatoes and cheese sauce.
Bake at 325 degrees Fahrenheit, covered, for 1 1/2 to 2 hours.
Stir together bread crumbs, melted butter, and Parmesan cheese. Remove potatoes from oven and spread the bread crumb mixture evenly over the potatoes. Bake, uncovered, 20 to 30 minutes more, or until potatoes are tender.