PREP: Grease or spray a 3-quart casserole dish and set aside.
SAUTÉ THE ONIONS AND SWEET BELL PEPPERS over medium heat in a medium/large skillet drizzled with a tablespoon of olive oil until nearly tender. (Leave the extra tablespoon or two of onions and peppers uncooked for garnish.) Cover to decrease cooking time. Add garlic and cook another minute or two. Remove to a bowl and set aside.
COOK THE ITALIAN SAUSAGE in the same skillet (add a little more olive oil) until well-browned and cooked-through. Drain, cool briefly, and chop into ½-inch pieces. Set aside.
WHISK TOGETHER the eggs, milk, salt, pepper, crushed red pepper, dry mustard, dried basil, and dried oregano in a large bowl. STIR IN THE DICED BREAD, reserved cooked onions, peppers, garlic, and the cooked sausage.
POUR EGG MIXTURE into the prepared dish and sprinkle with the mozzarella cheese. Push the cheese down into the egg mixture with a table fork, leaving a little cheese visible on top.
TOP WITH THE MUSHROOMS and reserved fresh onion and peppers. Add a last grind or two of black pepper over the dish. Cover with plastic wrap or foil and refrigerate overnight or at least for a couple of hours. In a real pinch, let the casserole sit at room temperature for 15 minutes before baking; it’ll still eat!
THE NEXT MORNING, preheat the oven with a rack at center to 375 degrees F. Remove the casserole from the fridge, uncover, and let sit at room temperature while the oven heats. Bake 60-70 minutes or until well-browned and crispy on both the bottom and the top with the center just barely set. If browning too quickly and not getting done at center, cover with aluminum foil for 5-10 min. Remove to potholders on the counter or board (do not place on stove top as these glass baking dishes can break) and let rest 10-15 minutes before cutting. Serve with grated Parmigiano-Reggiano, tomato sauce, sliced olives, and the reserved crushed red pepper, if using.
Store leftovers well-wrapped in the refrigerator for 3-4 days or freeze individual servings and thaw overnight in the refrigerator before heating over low flame in a small covered skillet or in the microwave.