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I've had a little idea about using Chosen in my Iron Warriors army. I may be off my head but in theory it seems to make sense, so here goes.

A 5 man Chosen unit with 4x Pairs of Lightning Claws and a Champion with a Power Fist (or a Lightning Claw and Melta Bombs?), riding inside of a Land Raider with a Dirge Caster. Probably with MoK for Rage. That's at least 16x S5 hits on the charge, without the fear of overwatch, and re-rolling to wound with the AP3 claws. Best against Loyalist Marines with the AP3, and could even throw in Votlw in that case, or indeed against any sizable blobs of any infantry.

Your thoughts for a penny? Oh and yes I'm fairly mad!

The issue with running Chosen for melee is that Terminators exist. A similar squad of Terminators will actually end up cheaper, while also being twice as tough. You can still fit all 5 of them in the Land Raider too.
They aren't without limitations; you couldn't get a supporting HQ into the ride with them, and they can't catch their enemies in a Sweeping Advance. But you are literally twice as tough, while also being cheaper.

Chosen have some utility as special-weapons gunners, but even then it is only useful when you've run out of Heavy slots for Havocs. Unfortunately Chosen are a unit out of time at the moment.

Honestly, there's no good way to run them for melee.

When you pay for that melee weapon, you're more expensive than a Terminator, and less durable. You have Grenades, but taking a Power Axe means you'll strike at I1 anyway. You have a couple more attacks, and killing an enemy just a LITTLE quicker means you'll be shot when you're in the open next turn.

Chosen are MANY more points for having almost no special abilities. They're like incredibly bad Sternguard/Vanguard.

If you want Lightning Claws on a melee squad, Terminators will get them for cheaper. Even Warp Talons would be a better method for delivering Lightning Claws than Chosen, and they have no grenades or anything and are worse than Raptors in all but a specific situation.

Nine chosen mark of khorne in a dreadclaws with an attached IC to your preference, no upgrades except perhaps stealth power fist.

Only good for hidden fist. Not worth their points.

I've had some pretty good success running 10 khorne chosen, with two axes, a banner, and a single claw on the champ riding in a dreadclaw. They're pretty choppy against most things you'd want to throw them against without being as expensive as an equivalent squad of berserkers or marines which normally need a lord or other character to do the heavy lifting. With crimson slaughter, you can also throw in the champion upgrade to give them preferred enemy, which goes a long way.

As other's have stated, be very careful about over-spending, as they get into terminator territory very fast. Their best value as a melee squad is being able to carry a few hidden power weapons, which means you don't need a character (very handy if your HQ is flying, or running with spawn or bikes instead). A couple axes or fists will pull the same weight as a 150pt lord. With marine stats, they're best as bully units to fight weaker targets. They arent great as a melee hammer or deathstar, they just arent durable enough.

I have a similar idea for Melee(ish) chosen in my Iron Warriors list too.

5 in a Rhino with 4 Plasma Guns(or Melta/Flamers so I could shoot and assault) VotLW and MoK. Go after something you think you could beat with Weight of Attacks Disembark and use your other rhinos are cover using their flat out movements to hide after you shoot with your weapons unless you think you can assault.

But I'm looking at a pure mech force, Everything is either in a Rhino or has an AV. And TBH It's kinda a Tactic I borrowed from playing Tau in early 6th before they got the new codex where you'd have your firewarriors start outside the devilfish and have the Devilfishes flat out the break LoS to your Fire Warriors after they shoot, so it might not translate as well to 7th edition or from Tau to Chaos.

Equipped with pairs of lightning claws? Yes, you would be quite mad lol. You can almost buy a terminator for each claw, not even counting the chosen it's attached to. It just doesn't work out in terms of points.
I quite like chosen, but I think they don't work to well as a dedicated melee unit. Not because, they can't pull it off, but because they become so expensive that other units can do roughly the same for less points or have other advantages like the terminators being significantly tougher (while also being cheaper in this case).

I like them because they're pretty nasty at range with their special weapons, yet are also able to hold their own in melee at the same time. They're quite efficient in that sense. They're not sternguard or anything but they can certainly pull their weight. Especially as Black Legion, making them troops.

That said if you want to increase their melee output without investing too many points, you could take a look at the Vessel of Dhornurgh the Reborn. If you mark them as nurgle, they get the +1T bonus , but if you put that legacy on their transport they would also get rending in melee provided you buy the icon. For 5 guys that would only be an extra 35 points, to give the entire unit rending (in melee), including any lord you add to the unit. As an added fluff bonus they (rightly so) gain fear lol. Maybe sprinkle in some special weapons or IC's to buff as needed.
Either way they're probably better off in a dread claw than they are in a Land raider. Or even a rhino in this case if you want to keep things cheap. Get a blight grenade in there and getting assaulted won't be quite as bad.

Chosen with 5 flamers > Chosen with 1 power fist

Was actually thinking about this a bit If you were going to use Rhino Chosen to assault(like I plan on trying) you could do like 3/2 Flamers/Plasma. You can only fire two guns out of a Rhino and the flamers give you that extra punch before you assault.

It also gives you a bit of flexibility if you get stranded far out of assault range. You'll still have Plasma Guns to fire downrange. It's probably not the most effective loadout for chosen, the squad with a Rhino, VotLW and MoK is almost 200 points for the 5 of them with 3/2 Flamers/Plasma, but Chosen are going to be expensive no matter how you cut it.

Well it seems conclusive that Chosen should be run as sub-par sterngurd squad with a load of special weapons, and that I truly am mad! Although I will try it out sometime just because it's something a bit different. Perhaps the new year will treat us to a new codex that we can all be proud of when playing our beautiful Traitor legions in which Mutilators, Chosen, Possessed, Warp Talons and our lowly Marines are worth bringing.

Chosen in Cypher formation are fine cause they get infiltrate.

As for melee-oriented squad, it can be done and used somewhat effectively. They can be an effective retinue for some choppy or tanky indep in a pod. Things that people tend to overlook is that they don't exchange their cc weapons or pistols for special gear like a flamer or a melta. So, you could still get a squad with a bunch of quite useful specials that totes at least 4 attacks on the charge.

Another thing is that special weapons are hidden in a squad. Take that one power fist and it doesn't get challenged out. A huge advantage. Yes, they can't get cheapo power weapons like sm guyz. They don't get chapter tactics, atsknf and stuff like that. But those special ranged weapons have a potential to overcome this issues.

So, my take on melee chosen is a bunch of guyz with 4 specials and one power fist with a character in a pod. So that you get vansternguards.

Or a min squad with specials in a rhino. Not melee primarily but don't underestimate extra attacks they get. Pretty capable of stomping face to a right foe.

That said, if you're going to Infiltrate, more reliable weapons, like the Plasma Gun and Melta Gun, are going to give more bang for the buck and you won't have to waste a turn after the initial Infiltration.

Like I said, trying to outfit Chosen for Melee is a fools errand. Maybe if they had the discounts like Vanguard did...

If you want to use chosen, then just leave them naked. With the mark of khorne they are rocking 5 attacks on the charge.

The issue though, as pointed out earlier, is that terminators do the job better and more efficiently. I personally like chosen, but like most things in the chaos marine codex you are trying to polish a turd at the end of the day.

If im running CC chosen, I always take MoS and IoE, the feel no pain helps so much. After that I attach my beatstick IC and proceed to adjust their weapons based on points, mainly leaving them bare though as they become wounds for my IC and provide some bolters for range.

Edit: throw abby in with them and he gets to benifit from IoE for the FnP!