Preheat the oven to 400°F and line a baking sheet with foil; spray lightly with cooking spray.
In a large bowl, combine the ground chicken, egg, Panko, grated Parmesan, Italian seasoning, kosher salt, and black pepper until just mixed.
Form the mixture into 1-inch meatballs and arrange them on the prepared baking sheet, spacing them slightly apart.
Bake the meatballs for 20 minutes, or until golden and cooked through (internal temperature 165°F).
While the meatballs bake, heat 2 tablespoons olive oil in a large skillet over medium heat; add the chopped onion and sauté until softened and golden, about 5–7 minutes.
Add the minced garlic and crushed red pepper flakes (if using) and cook until fragrant, about 30 seconds.
Stir in the crushed tomatoes and 1 tablespoon butter; season with salt and pepper to taste, then cover and simmer for 10 minutes.
Add the baked meatballs to the sauce, cover, reduce heat to low, and warm for a few minutes so flavors meld.
Meanwhile, cook the spaghetti according to package directions; drain, reserving a little pasta water.
Toss the cooked spaghetti with the sauce and meatballs, adding a splash of reserved pasta water if needed to loosen the sauce.
Top with freshly grated Parmesan and chopped parsley if desired, then serve.
