Once you're back in the Garden locate the ready to breed Chao and pick them up and put them next to one another. This is what a Chao looks like when it's ready to breed You'll be able to use the animal over and over again. There's a glitch to reuse animals that is very helpful, just set the animals right in front of the Chao, but not close enough to where the Chao grabs it. To make your Chao a certain type give it animals or Chaos drives (Animals are recommended) of that type and that type only until it is around level 25 in that stat.
It doesn't matter if your Chao is Hero, Dark, or Neutral. You don't have to do this, but it is recommend. For my other Chao it doesn't matter too much what type I make it, but I'm going to make it a power type so that E will become a D. Doing this will change the stat to an S when the Chao evolve. Since my first Chao has that A in swimming I'm going to raise it to be a swimming type. So now we want to to get these Chao to evolve so that we can breed them. Step 2: So let's pretend that my first Chao's stats are: