Preheat oven to 350°F. Grease a 13x9-inch baking dish with butter or nonstick cooking spray.
Melt 6 tablespoons of the butter in a large skillet over medium heat. Sauté onion for 3 minutes.
Sprinkle with flour and cook for 1 minute. Whisk in chicken broth and milk. Bring to a boil, and let it simmer to thicken, about 5 minutes. Season with half of the salt and black pepper. Turn off the heat.
Stir in 2 cups of the cheese until melted and smooth.
In a large bowl, add hash browns, sour cream, the remaining salt and black pepper, and the cheese mixture. Pour the mixture in the prepared baking dish and spread evenly.
Melt the remaining butter in a medium bowl. Fold the remaining shredded cheese and cereal. Evenly sprinkle over the top of the potato mixture.
Bake covered with foil for 45 minutes. Remove the foil and bake an additional 15-20 minutes or until brown and bubbly. Rest for 10 minutes before serving.