Place pork and bacon on a rimmed baking sheet, transfer to freezer, and chill until crunchy but not frozen solid. In a small bowl, combine the milk powder, salt, mustard powder, black pepper, coriander, and InstaCure No. 1. Nest a large mixing bowl in a bowl filled with ice. With a meat grinder fitted with a small die, grind meat into the bowl. Add the spice mixture to meat and stir with hands until well incorporated. Press a sheet of plastic wrap directly on the surface of the meat, cover the bowl tightly with plastic wrap, and refrigerate overnight.
Transfer meat mixture to the bowl of a food processor. Add half the ice water and process until liquid is incorporated and mixture begins to look sticky, 1 to 2 minutes. Add remaining water and continue processing until the mixture is smooth, 4 to 5 minutes longer. (The temperature of meat during mixing is critically important. Its temperature should never rise above 40°F.)
Stuff sausage into beef casings. Bologna should be 5 inches in diameter and 10 inches long. Heat a smoker to 170°F. Smoke bologna until internal temperature reaches 145°F, 2 to 3 hours. Remove from the smoker and cool. Transfer to refrigerator and stand, uncovered, overnight.