start making the chocolate inner layer for the puppy chow. In your small microwave safe bowl, add 12 Oz. of semi-sweet chocolate chips, 1/2 cup (1 stick) of butter, and 1 cup of peanut butter. Place this all in the microwave for 2-3 minutes, stirring about every 45 seconds. Make sure that everything is homogenous.
pour the bag of cereal in a huge bowl. I mean the biggest bowl you can find. It helps to have a lot of room to mix so that you don't crush a lot of the cereal. Add all of your Bacon Up into the bowl, and mix it all gently in. use your spatula to scoop out all of the chocolate mix onto the cereal. At first it might not seem like it, but there will be enough. Mix this slowly and gently with a big spoon until all of the ingredients are evenly covered with chocolate.
Fill your large ziplock bag or bowl with about 7-10 cups of powdered sugar. Like the bowl, the bigger the bag is, the gentler you can be with the pieces to ensure that few break. Spoon in all of your chocolate and Crispix mix and seal the bag tightly (avoid getting chocolate in the zip, it makes it hard to close). If you can't find a bag big enough to fit all of your mix, split it up into two or three batches; you need room in the bag to work with. Flip your bag end over end until the pieces are fully coated in sugar and stop sticking to each other. The bag's chocolate coated inside will gradually turn white as this happens. If it's taking too long, just add more powdered sugar. You can't really overdo it.