2 is correct "Chinese" describes the cuisine. Therefore many different types of food. And therefore you must use the plural "dishes". If you talk about one specific recipe you use the singular. For example, "My favourite dish is Peking Duck." You will hear people saying "My favourite dish is Chinese". But in that case they are omitting some words and they really mean "My favourite (type of) dish is (an example of) Chinese (cuisine)."

dishes.