Preheat oven to 350F (175C). Grease and flour a 9x13 inch baking pan.
In a medium bowl, whisk together flour, baking powder, and salt.
In a large bowl, cream together butter and sugar until light and fluffy. Beat in eggs one at a time, then stir in vanilla.
Gradually add dry ingredients to wet ingredients, alternating with milk, beginning and ending with dry ingredients. Mix until just combined.
Stir in cup freeze-dried strawberry powder.
Pour batter into prepared pan and bake for 30-35 minutes, or until a wooden skewer inserted into the center comes out clean.
Let cake cool in pan for 10 minutes before inverting onto a wire rack to cool completely.
While the cake cools, prepare the frosting: In a large bowl, cream together butter and powdered sugar until smooth.
Beat in freeze-dried strawberry powder, milk, and vanilla extract until light and fluffy. Add more milk if needed to reach desired consistency.
Once the cake is completely cool, frost the cake. Decorate with whole freeze-dried strawberries and/or a sprinkling of freeze-dried strawberry powder, if desired.
For a gluten-free option, substitute all-purpose flour with a gluten-free all-purpose flour blend. Ensure all other ingredients are also gluten-free. For a more intense strawberry flavor, increase the amount of freeze-dried strawberry powder in both the cake and the frosting. For a vegan option, substitute butter with vegan butter, eggs with flax eggs, and milk with plant-based milk.