This "democracies vs dictatorships" spin is just that, a nice story for the public. But this is not how countries operate and they have no values when it comes to international relations, only interests. You'll also notice that it's only some authoritarian countries that are 'problematic' otherwise are 'good friends'...

China is becoming powerful, so it is a threat to the established, Western, order and especially the supremacy of the US. That's the real issue. If tomorrow China became a democracy it wouldn't be any less of a threat, and in fact it might become a more formidable threat.