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You are totally wrong for two major reasons.

The first is that China is a poor country compared to the EU, Japan, and especially America. The average American is about 6 times wealthier than the average Chinese citizen, so it's unlikely that China has much disposable income to spend on video games. If you're interested, you can check out http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita .

Second, piracy is a huge problem in China. The government basically only enforces intellectual property rights when it is convenient. That's why you get hilarious knock-offs like the "Vii:" http://www.techybytes.com/the-vii-chinas-answer-to-the-wii/.

That's why nobody currently bothers to try to sell console games in China.