Pre-heat the oven to 350 degrees. In a large pot cook pasta according to package directions. Drain and set aside.
In a large skillet over medium-high cook bacon slices until crisp, turning once. Remove bacon slices from the pan and drain on paper towels. Reserve the bacon grease in the pan. Finely chop bacon and set aside. Increase the heat of the skillet to medium-high heat. Add chicken breasts to the pan and cook turning once until the chicken is fully cooked (the internal temperature has reached 165 degrees). Remove from the pan and chop the chicken into ½ inch chunks.
In a medium bowl whisk together milk and cream of mushroom soup. Melt butter in a large saucepan over medium heat. Sprinkle flour evenly into the pan. Cook for 2 minutes while stirring constantly with a whisk. Gradually add the milk and soup mixture to the saucepan while whisking. Bring to a boil and cook for 2 minutes or until the mixture becomes thick. Remove from the heat. Let stand for 4 minutes. Add Italian cheese blend, onion powder, garlic powder, dill, and salt. Stir until the cheese melts. Stir in pasta, chicken, and half of the chopped crispy bacon.
Lightly spray an 8-inch square baking dish with cooking spray. Spoon the macaroni and cheese mixture into the baking dish. Sprinkle evenly with Colby-jack cheese and remaining bacon bits. Place into the oven and bake at 350 degrees for 20 minutes or until the cheese has melted and the mixture is heated through. Remove from the oven and top with green onions.