Preheat oven to 325 degrees F (165 degrees C). Grease and flour a 9x13 inch pan.
In a large bowl, stir together cake mix and gelatin mix. Make a well in the center and pour in water, oil, and eggs. Stir in half of the container of strawberries. Beat on low speed until blended. Scrape bowl, and beat 4 minutes on medium speed.
Pour batter into prepared pan. Bake in the preheated oven for 30 minutes, or until a toothpick inserted into the center of the cake comes out clean. Allow to cool.
To make the Strawberry Frosting: In a large bowl combine margarine, confectioners' sugar and the remaining half of the frozen strawberries. Beat on high speed until creamy. Add milk a tablespoon at a time until desired spreading consistency is achieved. Spread on cooled cake.