Honestly, what China is doing is no different from the US making a bunch of World War 2 movies every year. The Nazis are probably the most common historical enemy portrayed in US movies. The difference is the Germans could care less about it because they've cut all ties with the Nazis.In the West, there is still very little knowledge about Japanese atrocities. Far more people have heard of Kristallnacht than the Rape of Nanjing, even if the former was a flash in the pan by comparison.
The experiments of Unit 731 makes Mengele look like an amateur by comparison. It says something badly of Japan that they still have a shrine where many of the worst war criminals are celebrated. They have also refused to properly make amends with South Korea for their use of enforced sexual slavery ("comfort women").
Unfortunately, I don't see things changing for the better. If you look at the polls, Japan seems to be slowly getting its own MAGA copycats.
For Chinese, Imperial Japan is just an easy choice for a villain, similar to the Nazis for Americans, because it's not particularly controversial, either within China or globally. The fact that the Japanese keep taking offense at the portrayal of Imperial Japan in Chinese movies and TV shows, though, says a lot more about them, than it does about China.