Shallowly cut the root end off of each onion so it can sit flat. Peel and discard the skins. Using a sharp knife, gently slice in 5ths, as if you were cutting a pie, about three quarters down through the onion revealing 10 sections, keeping the root intact. Soak the onions in a bowl of ice water for 30 minutes to help spread the sections. Transfer onions to a paper towel and remove excess water.
Whisk together egg and milk in another small bowl.
Add flour, salt, ground mustard, and chili to a small bowl.
Combine breadcrumbs and corn meal in a shallow dish.
Preheat air fryer at 375º for 3 minutes.
Roll onions in flour mixture. Shake off excess flour. Dredge onions in egg mixture. Shake off excess. Roll in breadcrumb mixture. Transfer to a plate. Repeat with remaining onions.
Add ½ of onions to fryer basket. Cook for 7 minutes. Transfer to plate and repeat with remaining onions. Sprinkle with salt to taste. Serve warm with dipping sauce.
* Percent Daily Values are based on a 2,000 calorie diet. Your daily value may be higher or lower depending on your calorie needs.