Yes, you can often do this substitution and I've done it successfully many times when I've run out of milk unexpectedly, but you should know that the substitution is never going to be perfect.
On a purely mathematical basis, let's say your heavy cream is 36% M.F. You need partially-skimmed 2% milk for your recipe. If you go purely by weight (which is almost 1:1 for volume when talking about mostly water), then 250 mL of 2% milk will contain about 5 g of milk fat. To get that from 36% cream, you only need about 14 mL, or approximately 3 teaspoons of cream. (Note - don't do this, read on!)
Of course, diluting cream at a ratio of 15:1 is ridiculous and you'll end up with something that's just really watery, and that's because milk is more than just water and fat. I only provide the above calculation for illustrative purposes, to show why there's no hard rule or even rule of thumb for this particular substitution.
With normal cream, most people go with half water, half cream, or if they're trying to approximate skim milk then maybe 1 part cream to 2 parts water. If you have double cream, I would probably use 1 part cream to 3 or 4 parts water; that will give you a reasonable approximation of the consistency of whole or skim milk without making it too watery.
Please keep in mind that different recipes/preparations use milk for different reasons, so this isn't going to work everywhere. I certainly wouldn't do it in baking, but for many stovetop recipes, the main purpose of the milk is just moisture, so you're fine to substitute cream + water and it doesn't really matter if you're "exact" - which you can't be anyway.
Butter flavored shortening and a touch of water (because butter has water in it too). The key thing here is that you have a have a solid fat because you're beating air bubbles into the butter during the creaming process. These bubbles are needed for the bread to properly rise during baking.
The browning process may be an issue though - shortening has no protein. You're after an umami flavor from the Malliard reaction ... it may be difficult to add that because of the lack of protein. A pinch of MSG maybe, for the umami?
Best Answer
When I am using skim powdered milk and want more fat, I just replace some of the water in the recipe with heavy cream.
Your recipe doesn't have water, it already uses milk and cream. You could replace a little of the milk with cream to make up the difference.
However, with all the cream and butter in that recipe, I doubt you would be able to notice the fat missing from the dry milk.
I would just use your skim dry milk and not worry about it.