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Preheat the oven to 300F with a rack in the middle. In a medium sauce pan over medium heat, add the ketchup, liquid smoke, brown sugar, minced onion, garlic powder, bacon bbq sauce and mix until combined. Cook until thick and bubbly; stirring occasionally. ~10 minutes.
Season the short ribs all over with salt and pepper. Place in a 13×9″ glass baking dish. This will be a tight squeeze. Pour about 1/2 cup over the short ribs.
Using tongs, flip the ribs over and spoon another 1/2 cup of the sauce over top. Reserve the remaining BBQ sauce to spoon over the cooked ribs. Cover the pan with foil and roast for 2 1/2 hours.
Remove the foil and gently flip the short ribs. Spoon more of the sauce over top. Cook for 30 minutes more (uncovered), until the meat is tender and browned. Check the ribs every 10-15 minutes to ensure that they are coated with sauce and that the pan did not go dry. Transfer the short ribs to a serving platter. Baste the short ribs with some of the reserved BBQ sauce. At this point you can discard the cooking liquid or you can pour it into a fat strainer to allow it to separate. (This is what I did). Pour the juices into a medium sauce pan leaving the fat greasy part behind. Add in about 1/4 cup bbq sauce and bring to a boil. Make a slurry of the cornstarch and water and whisk into the liquid to thicken. Use this to thicken the sauce as a dipping sauce/gravy.