You are right, it is scary how much of our debt the Chinese own.
My fear is not so much a military conflict since I believe that if they did make a move on Taiwan they would have to deal with the 3rd and 7th Fleets which would be too much for them, but if they wanted to cripple us they simply need to start dumping our debt.
True the fall in the dollar would not help their FX reserves with the current peg but if they are willing to go that far why should they care?
If and when the do decouple from the USD, I would take that a sign that they are ready to do something in the global arena. Right now if they keep growing 6-8% per year and they get sweetheart deals from Putin for oil, they can handle a depressed dollar. The FX reserves they are building will more than compensate.
$620 billion at last count.