I've been growing a variety of chilis recently and have experimented with drying several varieties. By best, Mk. I eyeball guess is that the dried flesh occupies between 1/2 and 1/4 the volume of the fully hydrated flesh.
So I'd shoot for approximately 1/3 as much (by volume) dried chili as fresh (assuming that you are comparing to finely chopped fresh chili, because the dried stuff does not retain the shape of the original).
Of course for small thin chilis that you can dry whole (like the little Thai reds) the substitution is one dried chili plus some moisture equals 1 fresh chili.
Garam masala is a catch-all term for an Indian spice blend. It has no fixed recipe but is likely to contain a combination of cloves, cardamom, cinnamon, bay, black pepper, star anise, dried chillies, coriander, cumin and maybe more or less. Blends vary according to family tradition and region. Spices are then dried out and possibly roasted, before being ground to dust.
The downside is that if you find garam masala hard to find you may well find the components equally tricky to source. In the UK we are spoiled by a wealth of Indian grocers who stock these ingredients in reasonably-priced quantities. These spices are also readily available in any supermarket due to our historic connection to India.
For a starting point that aims towards the curries that you have specified, I would combine 20g cloves, 50g cardamom seeds, 100g cinnamon sticks, 5 bay leaves, 75g black peppercorns, 100g coriander seeds and 100g cumin seeds. Some toast the seeds in a dry pan but to avoid scorching and to squeeze out all the moisture I use the Heston Blumenthal technique: dry-roast the spices in a very low oven (100C / 212F) for an hour and leave to cool. Blitz to powder in a coffee or spice grinder. I would recommend storing for up to 6 months in an airtight jar to preserve its punch.
Remember this is only a starting point and can be completely customised according to how you like your curries.
Best Answer
Yes, you can add garam masala in curry. Its taste is not like curry powder but adding in curry it gives delicious taste. I used garam masala in curry at my home. you can add 1 tble spoon of grinded garam masala in curry before adding yogurt in it.