Starting a venture in China is not that easy as a European compared to a Chinese. The strategy may work if one can get good support. The reverse is also true, it is no that easy to open a business in Europe as a Chinese.

Jui jitsu can go both ways.

I would say that unless China is your market focus on R&D / marketing / customer service in your primary markets and worry about that first. You can grow there while the folks in China will have troubles addressing anyone beyond their borders.

As for cloning your site into Chinese it's probably harder than you think and even still your site could be blocked with the right payoff to the government. When I was managing bitbucket.org a Chinese company approached us to license the technology and setup a mirror in China -- we refused and almost immediately bitbucket.org was blocked in China. A few weeks later a clone of bitbucket.org showed up with far less features.

It took many months of effort, however after working with the Australian Embassy and several lawyers to contact the Chinese government we were able to file a position with the Ministry of Technology (or Information, cannot remember exactly) and then a few days later our site was unblocked.

After it was all said and done, in the end we decided to focus on markets that are more approachable (western) since we could better service those markets as they matched our identity better.

Yes it seems definitely easier said than done.