Preheat the oven to 375°F.
In a large skillet, melt the butter with the liquid smoke over medium-high heat. Cook the shallot for about 2 minutes until softened, then add the garlic and stir for another 30 seconds.
Add the halved Brussels sprouts to the skillet and cook for about 6 minutes, until they’re just fork-tender.
Remove from heat and stir in the heavy cream, white cheddar cheese, Gruyère cheese, mustard powder, salt, and black pepper. Taste and adjust the seasoning as needed. Transfer to an 8x8-inch baking dish.
Bake for 20 minutes in the preheated oven, until the cheese is melted and the top is golden brown. Serve warm.