I usually just take a larger metal mixing bowl and place it on top of a 2-3qt sauce pan filled half with water. Get the water boiling, slice the cheese up into smallish strips/cubes (like half in cubes), and toss them in. Once the water is boiling, turn the heat down to medium to medium-low heat to keep it at a high temp. Make sure you stir and it takes a while, but it'll melt the cheese. I used to just toss the cheese in the sauce pan, but if you don't constantly stir it, it'll burn on the bottom and make cleanup a real PITA.
eta: Get the cheese melting first, THEN work on the sausage/bisquick mixture as there will be plenty of time to do that while you wait for the cheese to melt. And if you use a mini-muffin tin, that recipe will make around 50 sausage biscuits (my mini-muffin tin has 24 spaces on it)