I used to be able to open CHM files. Now when I try, I get a message saying:
Can't open … because PowerPC applications are no longer supported
Is there anything free that I can use that will open CHM files on OS X Lion?
As the error message says, you've probably been using an old application that didn't come as Universal Binary or was ever compiled for Intel Macs. Since OS X Lion, you can't run applications that were compiled for PowerPC only.
A quick search found CHM View, a free tool to view CHM files. It's in the Apple Store, so that will work on an Intel Mac running OS X Lion.
You may also want to try the iChm, a Cocoa CHM reader for both Mac and iOS devices. Take a look at, http://www.robinlu.com/ichm