6 Tbsp. butter, divided
1/2 lb. each sliced fresh mushrooms
1 Tbsp. sherry, optional
5 Tbsp. all-purpose flour
3 cups half-and-half cream
3 Tbsp. minced fresh rosemary
1 and 1/2 tsp. salt
1 tsp. pepper
2 cups shredded cheddar cheese
2 lbs. red potatoes, thinly sliced
1/2 tsp. paprika
Preheat the oven to 350°. In a large skillet, heat 1 Tbsp. butter over medium-high heat. Add the mushrooms; cook and stir until tender. If desired, stir in sherry and cook until sherry is evaporated, 1-2 minutes longer. Remove mushrooms from pan.
In same pan, melt remaining butter over medium heat. Stir in flour until smooth;
gradually whisk in the cream. Bring to a boil, stirring constantly; cook and stir until thickened, about 2 minutes. Reduce heat to medium-low. Stir in the rosemary, salt and pepper. Gradually add in the cheese, stirring until melted. Remove from heat.
Arrange the potatoes in an even layer in a greased 13×9-in. baking dish. Top with the mushrooms and sauce mixture; sprinkle with the paprika.
Bake potatoes, covered, for 40 minutes. Bake, uncovered, until golden brown and bubbly, 20-25 minutes longer. Let stand for 15 minutes before serving.