Green chilies should be slit when you want to infuse flavor without adding intense heat, or when you want to maintain their shape and visibility in the dish. Chopping is better when you want the heat evenly distributed throughout the dish.
The decision to slit or chop green chilies depends largely on the desired outcome in your cooking. Slitting a chili, which involves making a lengthwise cut without completely separating the halves, allows the chili's flavor and a mild amount of heat to seep into the dish. This is ideal for dishes where you want a subtle chili presence. The seeds, which contain most of the capsaicin (the compound that causes the heat), remain largely intact, limiting the overall spiciness.
Chopping green chilies, on the other hand, releases more of the capsaicin and distributes it evenly throughout the dish. This results in a more intense and uniform heat. Chopping is preferred when you want a significant spicy kick in every bite. Furthermore, the size of the chop can also influence the heat level; finer chops release more capsaicin.
Consider the visual aspect as well. Slitted chilies retain their shape and are easily identifiable, allowing diners to avoid them if they prefer less heat. Chopped chilies blend into the dish, making it harder to control the spiciness for individual servings.
If you're unsure about the heat level of your chilies, start by slitting them. You can always add more chopped chili later if needed, but it's difficult to remove heat once it's been incorporated into the dish.