I don't think space is really such a factor at the scale of a single city in many cases. Although China has a lot more land should it choose to build new cities or whatever, what matters more for existing cities is land in close proximity to them (to the point where transportation becomes the limiting factor).
Tokyo, for instance, has plenty of relatively empty space around it even today; it isn't severely geographically constrained in the same way that Hong Kong or Manhattan are.
China has eleven times the population of Japan and five times the habitable area.
Not far in from the coast, China turns into 2500m+ mountains with Siberian winters and few flat places. Then comes Tibet, the Mongolian desert, and the Gobi desert. None of those places will support cities, and most are dominated by non-Chinese people like Uigurs, Tibetans, Mongolians, and such. The vast majority of China on the map will never be Chinese and never support a major city.
