Puree watermelon and sugar in batches in your blender or food processor until smooth and strain into a medium bowl. Cover and freeze until puree is slightly slushy, but not quite solid, about 2 to 3 hours. Remove from freezer, stir well and add in chocolate chips.
Place twelve 5-ounce disposable cups in a shallow baking pan and spoon watermelon puree into cups, leaving about a 1/2 inch left from the rim. Place pan in freezer for 2 hours, or until puree is solid, but not rock hard.
Allow lime sherbet to soften a bit, then spread over top of each portion of watermelon puree so that it comes up to the edge of the cup. Smooth sherbet with the back of a spoon and cover each cup with plastic wrap. Cut a small slit in the center of each cup and insert a popsicle stick into each pop so that it almost reaches the bottom of the cups. Freeze overnight (or until solid) and can be frozen for up to two days.
Allow pops to sit at room temperature for about a minute, then gently pull out from the cups. Serve and enjoy!