It's not that Chinese cops are terribly competent, but they mean trouble, more trouble than harassing a foreigner is worth.

Bingo. Chinese make decisions based not upon right or wrong, nor based on legal or illegal, but based on "what choice means the least work?" Having cops around is rarely the path of least resistance for them, because they can never be sure who the cops will side with.
The gamble is that the cops themselves are frequently a source of the problem because they resent being made to do any work as well. I once had a situation where I was attacked in the streets (simply for being foreign), and when the cops showed up they told me I had to pay my attackers $1,000 RMB each for embarrassing them by fighting back (it seems two thugs getting beaten by one foreigner, who was walking with a cane at the time, made them lose face) or go to jail on the charge that I was the one who assaulted them.
I typically prefer to settle disputes with the Chinese knuckle to knuckle and then casually walk away in the several hours it takes for the cops to arrive, but given the value of the assets the idiot had behind the glass, I was basically a hostage here and had no choice.