Unwrap and sort the hard candies by color then place each color in its own small resealable bag. Place the bags on a thick cutting board to protect your counter, then crush them into small bits using a hammer or meat mallet and set aside.
Mix together 3/4 cup butter and 1/2 cup cream cheese at medium speed with a whisk attachment or hand mixer until smooth.
Next, mix in 1 1/2 cups Domino® Granulated Sugar at a medium-high speed for a couple minutes, until the mixture becomes lighter in color. Add in 1 egg and 2 tsp vanilla extract. Mix on a low speed until incorporated.
In a separate bowl, whisk together 3 cups flour, 1 Tbsp cornstarch, 1/2 tsp baking powder, and 1/2 tsp salt.
Gradually mix the flour mixture into the butter mixture on a low speed, until it is JUST incorporated. Scrape the side and bottom of the bowl with a rubber spatula as needed.
At this point, the dough will still be pretty sticky. Divide the dough in half, flattening it out into the shape of a rectangle, then wrap each piece of dough in a piece of plastic wrap. Chill in the fridge for about 2 hours or the freezer for 30 minutes. You can also chill the dough overnight.
Preheat the oven to 350 F / 175 C for about 30 minutes before you plan to roll out the dough. Line two large baking sheets with parchment paper or silicone mats and set aside.
Generously dust the surface you plan to roll the cookies out on with additional flour. Take one of the dough rectangles out of the fridge or freezer, leaving the other to continue to chill.
Sprinkle some more flour on top of your dough and on your rolling pin. Roll the chilled dough to be 1/4 inch thick and cut out as many circles as possible with a flour-dusted round cookie cutter. I used a 3-inch wide cookie cutter. Then use a smaller Christmas-shaped cookie cutter (Christmas tree, snowflake, etc.) to cut out the center of each cookie.
Use a kitchen brush to gently brush off any excess flour and place them 1 inch apart on the prepared baking sheets. Chill the cutout cookies one more time in the fridge for 15 minutes or the freezer for 10 minutes to help them keep their shape better.
Fill the centers to the top of the cut-out with crushed hard candies.
Bake for 13-15 minutes on the middle rack of your oven (time varies based on the size and thickness of the cookies). Keep a close eye on these and be sure to pull them out once the candy has melted and the edges of the cookies are set. Let the baked cookies cool fully on the pan.
While the first batch bakes and cools, knead together the cookie dough scraps, and rewrap them in plastic wrap. Pop them back in the fridge to chill.
Pull out your 2nd chilled piece of dough, and repeat steps 8-12. Then repeat with the chilled dough scraps.