The problem remains that China is simply too easy to unify. I think, given Chinese history (repeated political unification, from North to South), a divided China, unless it is imposed externally, is not likely. But I agree that a division would be the best way for Chinese proto-Capitalism to take off. I seem to recall, though, that the best takeoff for that might have been earlier (12th century?--my China background is especially weak).
A world history favorite of mine, The Human Web suggests that market capitalism worked well in China then in say Europe thanks to the unified state and the nature of its internal market. But my favorite bit from that book is that the Northern European moldboard plow team created social conditions that were uniquely favorable towards the development of "civil society" (including the non-familial business arrangement). Thinking about it just now that might explain Jews and other "commercial minorities" (i.e. the Chinese is parts of Southeast Asia, Indians in Africa and other British colonies)--same sort of civil society incentive.