But, while the devastating defeat edged the Blues closer to the drop, there were positives going into what looks set to be a make-or-break home double-header against Bromley and Dover Athletic.
And it is here where we start our look at three winners and three losers from the weekend's National League action.
Matty Waters' last start in a Chester shirt was back in October in the shocking FA Cup defeat at lower-league Kidderminster Harriers .
The talented 20-year-old was sent out on loan to Sutton Coldfield soon after - and his spell at the Northern Premier League side has served him well.
Waters impressed at Dagenham and for a long period his tidy 62nd-minute finish seemed set to earn the Blues a big three points.
"It's always good to get on the team sheet and to be back playing," said Waters to Chester FC TV.
"I have had a spell on loan so it was good to be out there again.
"It's a crucial time now, where we are in the table. We need to build some momentum, and we need a run, and there's no hiding that these (Bromley and Dover) are big games."
What made the defeat to the Daggers all the more painful was the fact that results elsewhere largely went the Blues' way.
It means their fight for survival remains difficult, but very much alive.
But you've got to fear the worst for Guiseley if they fail to win tomorrow at home to relegation rivals Barrow AFC.
Basement-boys Guiseley remain 11 points behind fifth-bottom Barrow after they went down 4-0 at Sutton United on Saturday.
There was no shame in that result. Sutton are the most in-form team in the division, winning four and drawing two of their last six matches to cement second spot in the standings.
Sutton boss Paul Doswell, whose side will have to rip up their 3G pitch if they were to win promotion to the Football League, said: "We need to make sure we get into the play-offs because that was the original goal, and the next step after that would be trying to finish second or third."
Macclesfield Town remain the team to catch, though, after they won 1-0 at home to Maidenhead United to maintain their five-point lead at the summit.
John Askey's men left it late, however, with substitute Scott Wilson's winner not arriving until the 91st minute.
"When you are in a match like that, those are the games that can win you the league," said Macc manager Askey.
"In previous games you can see the fitness levels of this side, in the last 10 minutes we have kept on going, it is fantastic."
Macc's form this season is remarkable given Askey is operating with one of the smaller budgets in the league.
But their current winning run of four matches is made all the more impressive given it has come after their players were paid their January wages late.
Sadly, events against Dagenham will have come as no surprise to Chester supporters, either those at Victoria Road or those back at home watching on Twitter through their fingers.
As, it was the TENTH time since the Blues lost in almost identical circumstances at the Daggerrs on February 4 last year that they have let points slip by conceding goals after the 85-minute mark.
The late lapses have resulted in defeats at Dagenham (twice), at home to Eastleigh, Tranmere Rovers, Macclesfield, Woking and Sutton, and away to Gateshead and Maidstone United, as well as a draw at Guiseley.
"Dagenham can still put out a canny team who have been there and done it, and know how to win football matches, and that's probably what we lack in terms of that game management and experience to see a game out," said Chester boss Bignot, who inherited the problem from his predecessor Jon McCarthy.
"And it was a game we should have saw out. They got their fortune with the second goal. It was a contentious decision but from that point on we shouldn't have lost the game.
"It would have been a massive three points as it would have clawed a lot of teams back into it."
That said, there is no question that the Blues are currently giving their all for the cause.
But Hartlepool United fans were left questioning whether that is the case after their side lost 1-0 on Saturday at home to Ebbsfleet United, who should have been out of sight at half-time after creating 14 chances.
Despite Pools' problems, both on and off the field, their vacant manager's position is still attracting plenty of interest, with former Huddersfield Town and Birmingham City boss Lee Clark in attendance against Ebbsfleet, while ex-Manchester United, Liverpool and England midfielder Paul Ince is also said to be in the running.
But former Tranmere manager Ronnie Moore, who saved Hartlepool from relegation from the Football League in 2015, insists he is the man for the job.
Moore said: "People will say I'm begging for a job - I'm not - it's just my view having had over 40 years experience in the game as a player, coach, manager that the club needs an experienced manager.
"I want to get back involved in the game. Everybody seems to think you get to 65 and you are a dinosaur; I am a Level 5 coach, it's as high as you can get."
Let's face it, we'd love to swap positions with Wrexham at the moment.
Unbeaten in 12 games, and sixth in the table, on the face of it things are going very well for our rivals from over the border.
But Dean Keates' side are struggling to see off opponents with their 2-2 draw at home to promotion rivals Aldershot Town on Saturday being the fourth match running that they have had to settle for a share of the spoils.
However, despite falling eight points behind Macclesfield, new striker Sam Ainge believes they can win promotion.
"Wrexham are a team at the top end of the league and I believe we can get promotion," said Ainge, who has joined the Dragons on loan until the end of the season.
"I've played against a lot of the players here over the last 10 years and I think there is a really good squad, so once I knew this was an opportunity I jumped at it."