Wash and pat dry half the strawberries. Dice 3-4 berries to yield 1/2 cup. Slice the rest of the washed strawberries. Return the unwashed strawberries to the fridge for serving.
In a bowl, beat cream cheese until smooth. Add 2 tablespoons sugar and diced strawberries and beat until blended.
Cut challah into 1-inch cubes. Add half the cubes to the baking pan in a single layer. Dollop with the strawberry cream cheese and scatter on sliced strawberries.
In a bowl, beat eggs until lightly frothy, then beat in milk, cream, remaining ¼ cup sugar, vanilla, and salt. Pour over the bread evenly.
Cover tightly with plastic wrap and refrigerate for at least 4 hours and up to 12 hours.
When ready to bake, remove from the refrigerator and preheat oven to 350°F. Remove plastic wrap and bake for 30-40 minutes, until cooked through and top is toasty.
Wash and slice remaining strawberries while french toast cools slightly, then scatter berries on top and sprinkle with powdered sugar to serve.