Quarter the potatoes and place them in a large pot with water. Place on stove over medium-high heat. Bring to a boil. Cook until the potatoes are fork-tender. Remove from heat. Drain and set aside.
While the potatoes cook, in a large sauté pan cook the diced bacon. Scoop out the pieces, keeping the fat in the pan.
Add two tablespoons of butter to the bacon fat and add the onion. Saute until translucent. Add in the chopped cabbage. Cook until very tender, about 20 minutes.
Remove pan from heat. Add in the cooked potatoes, nutmeg, and milk. Mash until the potatoes are smooth and the cabbage and onions well combined with the potatoes.
Season with salt to taste.
Serve immediately. For each portion, Scoop into individual portions. Make a well in the center of each and place in a pat of butter. Sprinkle with some of the bacon pieces and fresh parsley.