Hello,
Wow, I wish I had found this post years ago. I worked as a kitchen manager for Chi-Chi's in the 80's. I was fortunate to have kept a few recipies with me, and I use this one often.

CHI-CHI'S CHI CON QUESO

1 (32 oz.) block of Velveeta cheese
1/2 green bell pepper
1/2 red bell pepper
2 tbsp garlic powder, divided use
1/2 to 3/4 cup of half and half, divided use
1 can diced green chiles

Cube the Velveeta into 1/2 to 3/4 inch cubes.
Dice green and red peppers into 1/4 inch pieces.

Over a double boiler, or use a glass bowl over a pot of boiling water, add cheese, peppers, chiles, 1 tbsp garlic powder and 1/3 cup of half and half.

Stir as mixture melts. The consistiency should be like a thick gravy. If it is too thick slowly add more half and half until correct consistiency.

Taste. If necessary, add more garlic powder.

We had a steamer we prepared this dish in, so it was easier, but the double boiler works well, and allows you to control just how hot and spicy it will be.

Enjoy!