To dehydrate, I've found that a food dehydrator with good air circulation works better and maintains the heat and flavor of chilies. Dehydrators with no fan for air circulation have tended to take the heat and flavor away.
Wash, dry, and remove stems. Lay peppers on the trays, not touching each other. Stack as many layers of trays as your machine has or you need, cover with the lid. Plug in and you're gonna love the smell! Rotate from the bottom to the top each day or twice a day (depending on how quick they are drying).
Once completely dry, grind batches at a time up in your food processor and put in a freezer grade zipper bag, canning jar or used herb/spice container.
The tiny canning jars work great for gifts!