In a mixing bowl, whisk together the all-purpose flour, granulated sugar, baking powder, and salt until well combined.

Add the plain Greek yogurt, unsweetened applesauce, melted butter, and vanilla extract to the dry ingredients. Stir together until a smooth and sticky dough forms.

Preheat your air fryer to 350°F (175°C).

Lightly grease the air fryer basket with cooking spray or brush with a thin layer of oil.

Transfer the churro dough into a piping bag fitted with a star tip (about 1/2 inch wide). If you don't have a piping bag, you can use a ziplock bag and cut a small hole in one corner.

Pipe small churro bites directly into the air fryer basket, cutting the dough with scissors or a knife to the desired length (about 2 inches). Make sure to leave space between the bites to allow for even cooking.

Air fry the churro bites at 350°F for 5-7 minutes or until they turn golden brown and crispy on the outside.

In a shallow dish, combine the granulated sugar and ground cinnamon for the coating. As soon as the churro bites are done cooking, roll them in the sugar-cinnamon mixture until evenly coated.

For the optional dipping sauce, whisk together the plain Greek yogurt, honey (or maple syrup), and vanilla extract until smooth.

Serve the freshly coated churro bites warm, along with the dipping sauce if desired.