In a bowl, combine the broth or water, ketchup, 1 1/2 tablespoons soy sauce, rice vinegar, hoisin sauce, chili paste, sesame oil, brown sugar, and 1 teaspoon cornstarch. Set aside.
In a large bowl, combine 1 1/2 tablespoons soy sauce, the sherry, and 2 egg whites, whisk lightly to blend. Add the chicken pieces and let stand for 10 to 15 minutes.
Meanwhile, combine the 1 1/2 cups of cornstarch, salt, and pepper in a large food storage bag.
With a slotted spoon, lift the chicken out of the marinade, several pieces at a time, and shake in the cornstarch mixture to coat thoroughly. Transfer to a plate while coating the remaining chicken pieces.
Meanwhile, heat 3 to 4 cups of peanut oil, high heat safflower, or canola oil in a wok or saute pan. The oil should be deep enough to cover the chicken pieces. Alternatively, you may use a deep fryer to fry the chicken pieces.
When the oil is hot, about 365°, add about 8 of the coated chicken pieces and fry until nicely browned, about 4 minutes. Remove to paper towels while frying the rest in batches.
In a wok or saute pan, heat 1 tablespoon of oil over medium high heat. Add the coarsely broken chile peppers and garlic and stir fry for about 30 to 60 seconds, or until aromatic. Note: don't inhale the fumes -- smell from a bit of a distance. Add the sauce to the wok and cook, stirring, for about 30 seconds, or until thickened. Add the chicken pieces and stir fry until hot and thoroughly coated.
Serve with hot cooked rice or your favorite noodle dish.
Serves 4 to 6.