Mix ground beef, sausage, bread crumbs, 1/3 cup evaporated milk, onion, and 1 teaspoon chili powder together in a bowl; shape into small meatballs.
Cook and stir meatballs, 10 to 15 at a time, in a skillet over medium heat until slightly browned, 2 to 4 minutes. Return all meatballs to skillet, cover, and cook over low heat until meatballs are cooked through, about 10 minutes. Transfer meatballs to a 2 1/2-quart casserole dish. Pour excess grease out of skillet, reserving the browned bits of food in the skillet.
Combine cream of mushroom soup, cream of celery soup, 1 cup evaporated milk, and water in the skillet with browned bits of food; cook and stir until sauce is steaming but not boiling, about 5 minutes. Pour sauce over meatballs.
Combine flour, baking powder, and 1/2 teaspoon chili powder in a bowl; cut in shortening until mixture is crumbly. Beat 1/3 cup evaporated milk and egg together in a separate bowl; mix into flour mixture until a sticky dough forms. Knead dough about 10 times. Roll dough into a 10x12-inch rectangle on a floured work surface. Sprinkle Cheddar cheese over dough. Starting on the long end, roll dough around cheese forming a roll; cut into 8 to 10 slices. Turn slices on their side and flatten slightly with your hand; arrange on top of sauce.
Bake in the preheated oven until sauce is bubbling and biscuits are lightly browned, 20 to 25 minutes.