For cake: preheat oven to 350 degrees. Lightly grease 2 round 9-in. cake pans.
In large bowl, combine cake mix and gelatin. Add pureed strawberries, eggs, oil, and water. Beat at medium speed with an electric mixer until smooth.
Pour into prepared pans, and bake for 20 minutes or until a wooden pick inserted in center comes out clean. Let cool in pans for 10 minutes, then remove from pans, and cool completely on wire racks.
For frosting: In large bowl, beat butter and cream cheese at medium speed until creamy. Beat in 1/4 cup strawberry puree, reserving remaining for another use. Beat in extract. Gradually add confectioners' sugar, beating until smooth.
Garnish with sliced fresh strawberries, if desired.