When I began Tai-chi years ago, I thought sinking the "Chi" had something to do with keeping my attention focused on my lower abdomen, the tan tien. To aid in this effort, I serrated the plastic edge of a spice jar lid and taped this to my belly below the belt line; the proverbial stone in the shoe. While this was irritating enough, it didn't do the trick.
I also thought that sinking the chi had something to do with lowering my center of gravity. To this end, I worked lower and wider stances particularly in push hands and I slouched over a lot (interpretation at that time of "round the back"). This too did not result in sinking the chi.
What I completely did not understand in those early days was that "sink the chi" refers to a specific FEELING. (Such is my understanding at this time after practicing in the Wujifa system.) The sink the chi feeling is not related to paying attention to the dan tien nor is the feeling associated with depth or width of stance.
The Wujifa site has a nice article on the primacy of feeling in The Concept of Sit Down in Wujifa Standing. "...the common feeling for many people is the feeling "as if" they are starting to sit down on let’s say a bar stool."
I'd like to share a little parlor trick I've used to help people feel the feeling of sit down, of sink the chi.
This 'trick' requires about a two foot length of wood for example a 2x4 or a 2x6 or a section of book shelf.
First, I get the person structurally aligned and then tell him/her to slightly bend his/her knees. I stand behind the person and hold the length of wood under the "sits bones". (I've been strong enough to support the people I’ve worked with, however, if you are the person holding the board, err on the side of caution. You may require two people to hold the board.) I then tell him/her to sit down on the board.
At first the person may not "let go" and really sit down. You may notice him/her holding up in the chest; you will not feel you are holding his/her full torso weight. When I notice this, I reassure the person that I've got them, I won't drop them and encourage them to let the weight sink into the board, to really sit down on the board I'm holding. Sometimes it takes two to three tries before I notice the person let go and drop their weight. When you see this, you’ll know exactly what I'm talking about. This is a key internal movement.
After I feel that I have him/her "on the board", I say, "I will slowly lower the board and I want you to keep your knees bent exactly as they are and slowly transfer the weight from the board into your legs". Typically on the first attempt, the person will raise back up into his/her chest. When this happens, I point this out to the person, "Did you notice how you moved your weight back up into your chest?" This is often a new level of awareness for the person. Then we try again.
Usually on the second or third attempt, the person will "stay down" and successfully carry their weight in their legs, however, for only a few seconds after which the pain becomes unbearable and they rise back up into their chest. This is OK because now they just got a taste of sink the chi / sink the weight.
I've done this with martial artists, runners and dancers, those with strong legs and they are not be able to stand for more than a minute. This is where we all start. It takes time. From my limited experience, it looks like a cycle; the stronger the legs get, the more you can drop, and the more you drop, the stronger the legs get… all over time.
Here's a variation on the above trick that I have used. While standing, I back into a surface that is about sits bone height when my knees are slightly bent and sit, sinking my weight onto this surface. Then, I slowly slide off that surface, transferring the weight into my legs.
Remember, the method is not the truth. Once you get the feeling, get rid of the method. The method is the board or the surface that helps you discover the feeling. Once you notice that feeling, then practice replicating that feeling while just standing without the board or surface.
At this point in my training, this is what I understand is the meaning, THE FEELING of sink the chi.
I must also add that this feeling is not a one time, one level feeling. As I continue to release tensions and correct my structure, I continue to notice (well, truthfully, my teacher points out to me) other areas where I'm holding "up" and not sinking, and when I am able to let this area go, a whole new wave of painful standing ensues... and the cycle continues. This rabbit hole goes very deep.
One final note, all "pain" should be felt in the quad muscles. If there is any pain in any joint, then immediately STOP because you are doing this exercise wrong. You really need someone experienced in this practice to see what you are doing to correct and advise you.
Addendum: Feb 8, 2011. See also the article Rounding the Crotch (圆裆) for Tai Chi and Zhan Zhuang which discusses this feeling in greater detail.