Set instant pot to saute on HIGH to get it heating while you gather your ingredients. Once HOT, add pasta shells, pour in water and set to cook 5 minutes on HIGH pressure. Don't forget to set the steam valve to closed.
While the pasta is cooking, grate your cheddar and mozzarella cheese.
Once instant pot has completed it's cook time, do a QUICK RELEASE of the steam valve and open the pot. Carefully of the steam, this is hot! DO NOT drain the liquid.
Return the Instant Pot to the SAUTE setting on medium, add milk, pepper, dry mustard, butter, parsley flakes and all the cheese. Stir well to combine. Add the crumbled bacon, stir. Let sit for about 5 minute to allow it to thicken.