Preheat your oven to 375°F (190°C). Have a 9 by 13 inch baking dish ready. There's no need to grease it.
Cook the 12 slices of bacon in a large skillet over medium heat until crisp, in 2 batches if needed. Drain on paper towels, crumble, and set aside.
Peel the 3 pounds of Yukon Gold potatoes and slice them ⅛ inch thick, using a mandoline if you have one. If you're not using them right away, keep the slices in cold water, then drain and dry them well before layering.
Melt the 4 tablespoons of butter in a saucepan over medium heat. Add the 3 minced garlic cloves and cook for 30 seconds until fragrant.
Sprinkle the 4 tablespoons of flour over the butter and whisk for 1 to 2 minutes. It will look like a thick paste. Pour in the 2 cups of chicken broth gradually, whisking constantly until smooth.
Whisk in the 2 cups of heavy cream.
Season with 1½ teaspoons of the salt, the ½ teaspoon pepper, and the ⅛ teaspoon nutmeg. Bring to a simmer and cook 2 minutes, until the sauce coats the back of a spoon. Remove from the heat.
Spread 2 ladlefuls of sauce over the bottom of the baking dish. Arrange a third of the potato slices over it in an even layer and sprinkle with a pinch of the remaining ¼ teaspoon salt. Ladle sauce over to cover, then top with 1⅓ cups of the cheddar and a third of the bacon.
Repeat step 8 two more times, finishing with sauce, cheddar, and bacon on top. Sprinkle 1 tablespoon of the chives over the surface.
Cover the dish tightly with foil and bake for 45 minutes. Remove the foil and bake for another 45 minutes, until the potatoes are fork tender and the top is golden and bubbling. If the potatoes are tender but the top needs color, bake 5 to 10 minutes longer.
Let the dish rest on a rack for 20 minutes before serving. This is when the sauce sets.
Sprinkle with the remaining 1 tablespoon of chives and serve warm.