One way to hold these two meanings together: the two words name a colour and a plant family, not a single object. Everything in the pepper family that has turned red can wear this name — the big sweet one you slice for a salad, and the small hot one that is dried and crushed into a jar. The words tell you the colour; the kitchen tells you which thing is on the table.
Two branches
當菜吃的整顆紅椒
紅色椒家族裡個頭大、肉厚、不辣的那一支，整顆出現在砧板上。
noun · A2
A sweet red vegetable with thick walls and a hollow middle, eaten raw in salads or cooked in hot dishes. It is the same vegetable as a green pepper, left on the plant until it ripens and turns red, which makes it taste sweeter.
紅甜椒
磨成粉或壓碎的紅辣椒
紅色椒家族裡小而辣的那一支，曬乾、磨碎以後裝進罐子，失去了形狀，只剩味道。
noun · B1
A hot red spice made from dried hot peppers, added to food to give it a burning taste. It comes ground into a powder or crushed into small flakes, and it is not counted: you add some red pepper, not a red pepper.
紅辣椒粉