Prepare the sauce: In a bowl, whisk together mayonnaise, sour cream, ketchup, horseradish, garlic, salt, pepper, paprika, and cayenne until smooth. Cover and refrigerate until ready to serve.
Cut the onion: Trim the root end, peel, and cut the onion in half. Slice into quarters, then cut each quarter in half to create petals.
Prepare the coating: In a large bowl, mix flour, seasoned salt, pepper, garlic powder, cayenne, onion powder, and smoked paprika.
Make wet mixture: In another bowl, whisk together buttermilk and egg.
Initial coating: Place onion petals in a zip-top bag with ¼ cup of flour mixture. Seal and shake to coat.
Dip and dredge: Shake off excess flour, dip petals into the buttermilk mixture, then coat again in the flour mixture. Shake off excess.
Rest: Place coated petals on a parchment-lined tray.
Heat oil: Heat oil (about 2 inches deep) to 350°F (175°C).
Fry: Cook onion petals in batches for 3–4 minutes until golden brown.
Drain: Transfer to a paper towel-lined plate, then place on a wire rack to keep crispy.
Serve: Serve hot with chilled dipping sauce.