In a large bowl, mix together the powdered sugar, butter, condensed milk and vanilla extract. Using your hands, knead until it forms a thick paste. Refrigerate for an hour, or until firm and cold.
Make sure the cherries are well drained and pat them dry. Line a large baking sheet with parchment or wax paper. Set aside.
When the mixture is firm, scoop out about 2 teaspoons and form it around each cherry, placing them on the prepared baking sheet. I find that rolling the mixture into a ball and then flattening it into a disk is the easiest way to cover the cherry.
Place the baking sheet in the freezer for at least an hour until firm.
When ready to assemble, melt the chocolate chips in a microwave safe bowl in 30 second increments, stirring after each, until melted.
Remove the cherries from the fridge and dip into the melted chocolate, placing back on the lined baking sheet.
Refrigerate the cherries for about an hour until the chocolate is set and firm.