If necessary, pound the cube steaks to ¼” thickness. (Note: An easy way to do this is place the steaks between two pieces of plastic wrap and then use a kitchen mallet or rolling pin to pound steaks to ¼”.)
Pat steaks dry using paper towels; set steaks aside.
Using a plate or shallow bowl, add flour, baking powder, baking soda, salt, pepper, smoked paprika and onion powder; whisk together until well combined.
Spread bread crumbs out onto a second plate.
Using a separate shallow bowl, whisk together buttermilk, egg, hot sauce and minced garlic.
Using a large skillet, add enough oil to fill pan ½”; place over medium-high heat until oil reaches 350°F. (Tip: To determine when oil is hot enough, drop a pinch of breadcrumbs into the oil. If it bubbles up immediately, then the oil is ready. If the oil begins to smoke at any point, immediately reduce heat.)
Working with one piece of steak at a time, dip both sides first into the flour, then into the buttermilk mixture and then finally into the breadcrumb mixture. Place the steak into the skillet. (Note: I typically do this in 2 batches of 2 steaks each so as not to overcrowd the skillet.)
Fry steaks for 3-4 minutes per side, or until both sides are golden brown. Remove steaks from skillet and place on a paper-towel lined plate.
For the Gravy
Once steaks have been fried, drain all but ¼ cup of the leftover oil from the skillet.
Place skillet over medium heat. Once hot, add the diced jalapenos and bacon; sauté for 3-4 minutes, stirring occasionally, or until jalapenos have softened slightly and bacon is crispy.
Gradually whisk flour into skillet, scraping the bottom of the skillet with a flat-edged wooden spoon to release any solids into the gravy.
Add buttermilk, whipping cream and spices (salt, pepper and paprika); stir until well combined. Bring gravy to a simmer, stirring often.
Continue cooking for 6-7 minutes, stirring often, or until gravy has thickened. (Note: If gravy becomes too thick, just add 1-2 Tbsp of cream or milk.)