I have a customer who wants a chocolate chip cake and I thought I had read somewhere to keep the chips from sinking to the bottom of the batter you should toss them in flour. Is this correct or is there some other way to do this?

..you are correct! I just toss the chips in a tiny bit of flour and then add them to the batter! Works great!

I have also found that if you use the mini chips instead, they don't sink as bad if at all.

Ooh, are you making the chocolate chip cake from CC? This one: http://www.cakecentral.com/cake_recipe-2054-30-Chocolate-Chip-Cake.html
It is soooooo awesome. My favorite cake so far - rave reviews! I've used mini, regular, and a combo of chips - coated with flour seems to work great.