First of all I'm Chinese.
...
...until I found loads of drone footage taken in the busiest area of Shanghai...
Not taking anything away from waynesi’s post, however:
The way the locals, civilian and police, will respond to a foreigner with drone is highly likely to be different from their response to a local.
Second, Shanghai is a poor representative of how mainland China is.
I live in China, and recently brought my drone here. I’ve registered it, and over the next days I’ll start experiencing first hand the answer to this question.
But my research suggests that, with a little common sense you can stay out of trouble.
It pays to launch from a location away from people, then fly to your point of interest. Reports suggest that sooner or later, some local will inform you it is not allowed to fly there, and a discrete withdrawal is always the wisest course in any conflict with locals.
Locals can be intensely curious, and sometimes don’t have much respect for boundaries.
Best advice is to avoid people.
And if you’ve been to China, you’ll realize how hard that can be.
Officially, however, it is legal once you’ve registered, though there are NFZ all over the place, and most of them do not appear on the DJI map for security reasons. You’ll just find a bunch of places you can’t fly.