Place the chicken breasts in the Instant Pot.
Add chicken broth, diced tomatoes with green chilies, garlic powder, onion powder, paprika, salt, and black pepper.
Close the lid and cook on High Pressure for 10 minutes.
Allow a 5 minute natural pressure release, then carefully release the remaining pressure.
Remove the chicken and shred it using two forks.
Turn the Instant Pot to Sauté mode and return the shredded chicken to the pot.
Add the broken spaghetti and gently push it into the liquid.
Cook on Sauté mode for 6–8 minutes, stirring occasionally, until the spaghetti is tender.
Add butter, cream cheese, milk, and shredded cheddar cheese.
Stir until the cheese melts and the sauce becomes creamy.
Taste and adjust seasoning if needed. Garnish with parsley and serve warm.