Using graphite powder as a heat moderator has several benefits: It has some downsides: And some things that are neutral, but might be irksome:

What is the thermal conductivity of powdered graphite?

Most statistics given online assume solid graphite, and thus assume you use graphite in its proper orientation. With powdered/flaked graphite, this isn't the case. So this data is more difficult to come by.

How is industrial graphite pressed?

See here, particularly the bit about "graphitization". To get the carbon to align, you need temperatures of 2500-3000°C. So, this plainly isn't something you can do at home.