In a large skillet over medium heat, brown the sliced Cajun smoked sausage until caramelized on both sides. This step builds deep flavor, so let it get a little color. Remove the sausage with a slotted spoon and set aside, leaving the flavorful sausage drippings in the pan.
Add the gnocchi directly to the skillet. Let them fry in the sausage grease, stirring occasionally, until they become lightly golden and slightly crisp on the outside. This adds texture and prevents them from becoming too soft in the sauce. If there is excess grease, carefully remove some, leaving just enough to coat the pan.
Stir in the drained pimentos and diced green chiles. These bring color, a slight tang, and a gentle heat that balances the richness of the dish.
Return the sausage to the pan and pour in ½ cup of water. Season with pepper to taste, garlic powder, onion powder, and a sprinkle of dried parsley.
Bring the mixture to a boil, then reduce the heat and allow it to simmer for 4–5 minutes. The liquid will reduce slightly and the flavors will meld together.
Pour in the heavy whipping cream and bring to a gentle simmer. Within a few minutes, the sauce will begin to thicken and coat the gnocchi.
Remove the skillet from heat and stir in the freshly shredded sharp cheddar cheese. Stir continuously until the cheese melts completely and the sauce becomes smooth and creamy.
Serve warm, straight from the skillet.