In hindsight manufacturer teams quit F1 because it was too expensive back in late 2000s, BMW/Honda/Toyota all left just because of costs. Hypotheticaly speaking the first thing a Chinese corp could have done was to just buy those teams and those factories back then. Maybe secure deals to acquire those engines and develop them as your own.

The Chinese could own like 1/3 of the grid today. Sure as you said everything would have to be in Europe etc but the first principle of modern Chinese economics is just investment for long term and eventually they could have relocated back to China. There was even a period where F1 was trying to expand in Asia(Korea GP, India GP) and having major Chinese manufacturer teams in the top 5 would have changed a lot in the early 2010's. All daydreaming now of course.

Way too much potential in F1 comes down to money and return on investment, those manufacturers treated F1 as a marketing budget just as much as a "R&D" division, the road relevancy rethoric was always false. Mercedes proved so many times for them it was just about winning and marketing.