I have never fragged a chili coral, but I would assume it would be the same as any other softie, cut with a razor or similar instrument, then use one of the many connection tecniques, I would try either the rubber band or the shallow dish method first, if it were me. best of luck with it.
you could always just give it to me, then I would frag it untill I figured out what worked best and let you know.....
hmm, looks like I have to get my hands on some chili coral and figure out the fragging.