Different versions of Axis & Allies have handled China differently.
NGE China is 3 pro-US neutral areas, Their only defense is the 3 IPC penalty for neutral violation. The US can only gain control if the Allies liberate the areas from the Axis.
AA50 China operates differently from a normal nation
1, China builds 1 infantry/2 areas controlled. No normal income or builds
2. China may place the infantry in area controlled, even if newly conquered, as long as China has less than 3 infantry already there
3. Chinese units can't leave China, which includes the Japanese-held areas and Hong Kong.
AAP40 China is somewhat different from a normal country
1. China has no capital
2. China can only build infantry (or artillery if the China Road is open).
3. China has no industrial complexes. They can build in any controlled area, even if newly-captured
4. Chinese can only enter Chinese areas (including 2 held by Japanese at game start), Kwantung and Burma.