The best tacos I've ever had were at "El Poblanos" in Mexico... not sure exactly where it is in mexico because friends have always taken me, but it's this shack with like 4 bar stools. When you place your order, they take the dough and make a tortilla for you right there... then they flip it and add all the ingredients. Mmmm.
My other favorite mexican place is El Pollo Norteno in Oxnard, CA.
Ah crap I just realized you asked for a favorite mexican dish, not restaurant... oops.
Chimichangas usually.