Spray a (6-cup) bundt pan with cooking spray and set aside.
In a medium bowl, whisk together flour, baking powder, and salt.
Cut 1/2 cup butter into small cubes and pour into dry ingredients.
Use a fork to mix in the butter until dry ingredients are crumbly and about the size of peas.
Slowly pour in 1 cup milk, mixing until a dough forms.
Use your hands to knead the dough about 10 minutes, until smooth.
Pour dough onto a lightly floured surface and pat into a (10-inch) round.
Cut dough up into (1-inch) pieces and set aside.
Combine Italian seasoning, chili powder, garlic powder, and Parmesan in a gallon sized zip top bag. Close bag and shake to mix.
Pour cut pieces of dough into bag of spices.
Gently knead bag until each piece of dough is coated in spice mixture.
Remove dough pieces and arrange evenly in greased bundt pan.
Set Instant Pot to Sauté. Pour in remaining 1/2 cup butter. Whisk for 1 minute, until butter is melted.
Turn off Instant Pot. Pour butter over the top of pizza bread pieces in bundt pan.
Remove cooking pot and clean it. Put it back inside Instant Pot.
Add 1 1/2 cups water to Instant Pot and place a trivet inside Instant Pot.
Cover bundt pan with a paper towel and foil. Crimp edges to discourage water from getting inside pan.
Create a foil sling and carefully lower bundt pan into the Instant Pot.
Close lid and set the pressure release to sealing.
Press Manual or Pressure Cook button and adjust cook time to 21 minutes.
Allow pressure to release naturally for 5 minutes and then quick release remaining pressure.
Remove bundt pan using foil sling. Remove foil and paper towel from the top of pan and let cool on a rack for 5 minutes.
Serve with pizza sauce for dipping.