Pour the water into your Instant Pot. Add the macaroni, onion powder, garlic powder, salt, and 2 tablespoons butter. Give that all a stir
Place the lid on the pot. Set the valve to sealing, and then set to high pressure/manual for 4 minutes.
When the timer goes off, turn the valve to quick release the pressure. When the pin has dropped remove the lid and stir the noodles to break them up.
Add the remaining 2 tablespoons butter, sour cream, and 3/4 cup milk. Stir to mix until the noodles are coated and butter is melted.
Add 1/3 of the cheese at a time and stir until the cheese is melted. Continue until all the cheese has been added to the pasta. (DO NOT dump it all in at once, doing this will effect the consistency of your cheese sauce.)
If the sauce is too thick, add the remaining 1/4 cup milk, a little at a time, until the sauce is your desired consistency. Check the seasoning and add salt and pepper as needed to taste.
Portion into bowls and sprinkle with a little fresh parsley, crumbled bacon (YUM!), or bread crumbs, if desired. Serve warm.
It is highly recommended that you shred a block of cheese yourself instead of buying the pre-shredded stuff. This will ensure a creamy cheese sauce. The consistency of the sauce will change if you use pre-shredded cheese. You'll need an 8-ounce cheese black for 2 cups of shredded cheese.