In 1-gallon resealable food storage plastic bag, combine buttermilk and hot pepper sauce. Add chicken pieces; seal bag and turn to coat. Refrigerate 1 to 2 hours to marinate.
Lightly spoon flour into measuring cup; level off. In shallow dish, combine flour, 1 teaspoon salt, thyme, 1/2 teaspoon pepper and nutmeg. Reserve 3 tablespoons flour mixture in small bowl; set aside for gravy.
Dip chicken pieces in remaining flour mixture, coating well; place on ungreased cookie sheet. Let stand 5 minutes to set flour coating. Discard any remaining buttermilk mixture.
Meanwhile, heat 1/2 inch oil in 12-inch skillet over medium-high heat until oil starts to shimmer (about 350°F.). Add chicken pieces, skin side down; cook about 10 minutes or until deep golden brown.
Heat oven to 400°F. Turn chicken. Reduce heat to low; cover and cook an additional 20 minutes or until chicken is fork-tender and juices run clear.
Uncover chicken. Increase heat to medium-high; cook an additional 2 to 3 minutes. Turn chicken; cook an additional 2 to 3 minutes to crisp coating. Remove chicken from skillet; drain on paper towels.
Bake biscuits as directed on can.
Meanwhile, discard all but 2 tablespoons oil from skillet. Reduce heat to medium-low; stir in reserved flour mixture with wire whisk until smooth. Cook 2 to 3 minutes or until bubbly. Gradually add milk, stirring constantly. Stir in 1/4 teaspoon salt and 1/8 teaspoon pepper. Bring to a boil. Boil 2 to 3 minutes or until thickened, stirring constantly.