Its just a sterotype, but people found it offencive.

I don't believe it was racist, and I doubt Disney intended for his character to be portrayed as such as an act of racism, because Disney's characters are very public, so if a character of theirs was racist they'd probably know that the audience would come after them for it (which leads to bad press & bad sales).
Like BuffyWolfie said, most of the time chihuahuas in movies are Mexican.

So, no, he may be a little stereotypical, but not an act of racism.

It's simple stereotyping. Nothing to get offended about.

Maybe... after all there was that whole thing with TLK being racist... sometimes people think everything is racist. I heard a Pokemon character got changed because it was, apparently, racist. Plus, the trading card game was, so they say, blasphemous.

I don't think so. The chihuahua dog is portrayed as mexican in most movies. It would be like hating Mulan because she's asian and not white.

People want characters with differences. It would be boring if they were all the same. So no, I do not believe that it was racist.

Well... I don't think... And I don't know.