Maybe in more rural areas, but there is large growing fan base that still enjoys watching Hong Kong and Chinese Kung Fu movies (yes even the newer ones). The Korean movies and Japanese anime are a few examples that are popular as well. Fans want to see something different instead of the usual CGI fill Hollywood repeats of the same genre over and over. Why do you think t.v series like Game of Thrones, Walking Dead, Breaking Bad, etc. are so popular and doing well? That's because it's creative and offer a more unique story line and scenario. There will always be the Michael Bay type films of explosions and cleavages of bossom women year round for the fun of it. But I think fans really wants to see some really good plot and imagination as well.
True but Mace's observation holds true as well. Chinese movies is just not going to reach it's true potential with the North American audience I think that's pretty much a fact.
Hollywood is all about $$$$$. They know this as well. If they think for a single second that by replacing Tom Cruise, Tom Hanks, RD Jr., Chris Pratt etc with an Asian actor would generate more revenue they would do it in a hearbeat!
I think it's a safe assumption that had Avengers or Avatar etc been made in China with all Asian cast it wouldn't have done anywhere close like it did in the NA box office. Not to say it wouldn't have been be profitable but no where close to the actual movies.
the same goes with other forms of entertainment be it singers, sports stars etc. There are probably ten thousand chinese singers more talented than say Kate Perry, Taylor Swift etc but I guarantee you more people will go see their concerts than these chinese singers and this could be in Asia itself.
It's all about marketing and perception to draw the crowds.