They are awesome at copying. You can buy $5000 gold clubs for $500 and an expert will tell you they are great. I recall they stripped and copied a motorbike years ago. Oddly, the name of it was real close to the original and they got done. Wife is Chinese (and honest!) but they all advise not to buy anything electronic there unless you are there and know the gear. While there is a perception (and fact) that chinese general stuff is cheap and nasty, you can get quality products there too. And cheap. But you really need to be there. We got drapes made, very fancy, very nice, thick materal, great workmanship, and cheap.
A mate bought an iphone 4 from a guy on Trademe, all up front. he got it and it was in fact genuine. Or so he thought until it was turned on it had the typical chinese UI that you see on chinese MP3/4 players. Colourful, silly fonts, etc. Got money back, but on the outside it was un-noticeable