The name is a combination of "diamond" and "mine," as in, "belonging to me," which in turn is a play on "diamond mine."
Many were outraged when Chip switched mediums from gold to diamond, but now we see it as a necessary step in his maturation as an artist. Also: SHINY!
- Chip: A Chisel's Life: A Biography
Below is a video walkthrough on where to find all the diamond gnomes.