Microwave peanut butter and chocolate in large microwaveable bowl on HIGH 1 ½ minutes. Stir until chocolate is completely melted and mixture is well blended.
Pour over cereal in large bowl; toss to evenly coat. Place 2 large sheets of aluminum foil on counter, with long sides of foil slightly overlapping. Spread cereal mixture onto foil. Let stand 2 hours or until chocolate coating is set.
Place powdered sugar in fine mesh strainer. Shake strainer over cereal mixture to evenly coat cereal mixture with sugar. Store in tightly covered container at room temperature.