To prepare yogurt cheese, place a colander or sieve in a 2-quart glass measure or medium bowl. Line colander with 4 layers of cheesecloth, allowing cheesecloth to extend over the outside edge. Spoon yogurt into the colander. Cover loosely with plastic wrap, and refrigerate for 12 hours. Spoon yogurt cheese into a bowl, and discard liquid. Stir in chives, 1/4 teaspoon salt, and 1/8 teaspoon pepper. Cover and refrigerate.
To prepare potato pancakes, spread the potato and onion between several layers of paper towels; let stand 15 minutes or until barely moist, pressing occasionally. Combine flour, 1 teaspoon salt, 1/2 teaspoon pepper, and eggs in a large bowl. Stir in potato and onion.
Heat about 2 teaspoons oil in a large nonstick skillet over medium-high heat. Spoon 2 tablespoons potato mixture for each of 6 pancakes onto pan. Cook 2 minutes on each side or until golden. Repeat procedure with the remaining oil and potato mixture. Serve the pancakes with yogurt cheese.
Note: To freeze, let cooked pancakes cool completely. Stack in an airtight container between layers of wax paper, and freeze for up to 2 months. To reheat, place on a baking sheet. Bake at 350° for 15 minutes.