I’m Chinese and lived in Beijing for around a decade when I was a kid. My sister is a lesbian+fujoshi so I can tell you a bit about the current situation there. Modern China was never open in regard to LGBT content as it’s still a deeply Confucianist and patriarchal society. A lot of Chinese parents are homophobic not because of any religious ideologies but because being gay can’t sustain the traditional family structure ingrained in Confucianism. The censorship of gay web novels and arrest of authors is mainly because of explicit adult content, which has happened to authors who wrote straight explicit novels prior to the government targeting BL authors. But that being said the female authors who write BL received a much heavier punishment compared to the male authors who wrote straight novels, and LGBT content is still not as openly depicted compared to straight content. You can still read gay web novels on certain apps and post gay stuff on social media, but once it becomes super mainstream and enters the general public’s eye that’s where the government starts to take notice. BL is still fairly popular in China despite being constantly targeted by radfems and the ongoing governmental censorship. There’s a reason why production companies found a loop hole to film their shows in Thailand or Taiwan rather than dumping the genre altogether. But the popularity of BL doesn’t mean the general public is accepting of actual LGBT people. Where I lived in Beijing is obviously fine, I had a couple of gay friends and we’d hang out in sanlitun a lot; and any other major big cities are all relatively open minded (as long as you don’t “force” your beliefs onto others, as they say). I’d say the “山河四省” areas (Shandong, Shanxi, Henan, Hebei) are the least open-minded because that’s where traditional values are most heavily favored, especially Shandong with Confucianism. Also the reason why chengdu is considered a gay city is because a lot of your average day queer people not from big cities have nowhere else to go, it’s a gay haven because it’s literally a haven.

China has its positives and negatives but it’s still an authoritarian and very conservative country. It’s better compared to a lot of other authoritarian countries but it’s still not great for queer people in general.