Place the chopped chocolate and 1 1/4 cups of the milk in a small, heavy-bottom saucepan. Cook over medium-low heat, stirring occasionally, until the chocolate is melted and the milk begins to simmer.

While the chocolate is melting, in a separate small bowl, whisk the cornstarch into the remaining 1/4 cup milk until smooth. Pour the cornstarch and milk mixture into the saucepan, and stir to combine.

Simmer the chocolate mixture, continuing to stir occasionally, for about 2 minutes or until it coats the back of a spoon. Pour into a small container for dipping, and allow to cool to room temperature before serving. The sauce will thicken as it cools.

Combine 1 cup of water, butter, sugar, and salt in a medium saucepan over medium-high heat. Bring the mixture to a boil, and immediately remove from the heat. Use a wooden spoon to stir in the flour, when it is completely incorporated return to the heat.

Dry the mixture by stirring constantly over the heat until it pulls away from the sides and the liquid has cooked out, about 4 minutes. Some of the dough will create a thin film on the bottom of the pan, this is perfectly normal.

Transfer the dough to the bowl of an electric mixer with the paddle attachment, and mix on low speed for a few minutes to cool slightly. Add the eggs, one at a time mixing until each addition is incorporated.

Once all of the eggs are incorporated test the batter by touching it with your finger or a rubber spatula, if a sticky ribbon forms when you pull away the batter is perfect. If not, add an extra teaspoon of water, mix thoroughly and test again. If your batter at this point is still not creating a sticky ribbon you can add water a ½ teaspoon at a time until it does. Fill a pastry bag fitted with a large star tip with the pâte à choux and set aside.

Pour 2 inches of oil in a heavy-bottom pan with high sides and heat the oil over medium heat until the temperature of the oil reaches 350°F. While the oil is heating, combine the 1/2 cup of sugar, cinnamon, and vanilla powder in a medium bowl and set aside.

Once the oil is to temperature pipe out 3 - 4 strips of dough, 4- to 5-inches long, into the hot oil. Fry for about 1 minute, gently flip over the churros, and fry for another minute or until golden brown and firm. Remove from the oil to a paper towel-lined plate, allow to cool briefly before tossing the hot churros in the cinnamon-sugar mixture to coat. Repeat with the remaining pastry dough.