Preheat your oven to 350°F. In a large mixing bowl, combine the white cake mix, eggs, oil, and water, stirring until just combined and smooth—don't overmix. Pour the batter into a 9x13 inch baking pan and bake for 28-30 minutes until a toothpick inserted in the center comes out clean. Remove from the oven and let cool to room temperature, about 30 minutes.
Once the cake is cooled, use a fork to poke holes all over the surface of the cake, creating pockets for the gelatin to seep into. In a bowl, dissolve the strawberry gelatin in 1 cup of boiling water, stirring for about 2 minutes until completely dissolved. Add the 1/2 cup of cold water to cool the mixture slightly, then pour it slowly and evenly over the entire cake surface, allowing it to seep into the poked holes. Refrigerate for at least 4 hours or overnight until the gelatin is fully set.
Remove the softened cream cheese from the refrigerator and place it in a mixing bowl. Beat the cream cheese with the sugar until smooth and creamy, about 2 minutes. Gently fold in the whipped topping with a spatula until fully combined and fluffy. I like to fold by hand rather than using an electric mixer here—it keeps the whipped topping airy and prevents deflating it.
Spread the cream cheese mixture evenly over the chilled cake from Step 2, covering the entire surface. Now arrange the berries to create a flag pattern: place the blueberries in the upper left corner in a rectangular block (representing the union of the flag), and arrange the strawberry slices in horizontal stripes across the remaining cake, alternating between strawberry rows and white frosting rows for a classic American flag design. I've found that chilling the berries for 30 minutes before arranging makes them easier to handle and less likely to slide around on the frosting.
Refrigerate the completed cake for at least 2 hours before serving to allow the flavors to meld and the frosting to fully set. This resting time ensures clean slices and the best texture. Serve cold and enjoy!