Sure you can have romanticized thoughts about how Bitcoin is impervious to the government with current technology but the reality is the Chinese government has many ways in which they could basically decimate the level of Bitcoin usage in China:
1. Shut down exchanges and stop all Bitcoin relared wire transfers from banks.
2. Firewall all Bitcoin sites,  flag all Bitcoin software as malware in operating systems, firewall tor exit nodes, don't route bitcoin traffic, stop postal shipments from wallet vendors,  etc. Only the most sophisticated hackers will still be able to use bitcoin.
3. Pass laws against bitcoin use with penalties of jail and fines. The Chinese are very obedient and fearful of their government and will comply.