Blackstone
Brigadier
While "face" is a consideration among many, especially with the unyielding Chinese public, the underlaying issue is US primacy in Asia. How do we know that? Obama said several times it's about who sets the rules. On the other side, Xi Jinping wants a "new model of major country relations," and why would he say that if he's happy with the existing model? So, what does Xi want? Most likely China to lead in the long-run, but co-leadership for now.I think this is the area where the room for miscalculation is the greatest. Sovereignty over a territory needs to be in substance and not just in form. China has made a claim of sovereignty and the source of authority either rest on its legality or in might. China cannot invoke the law because to-date its claim is nebulous and that leaves it with the only other option. The US is signalling its intention to challenge the claim via FON. Depending on how one views substance, shadowing the US warship(s) is hollow form in staking a claim through might. This is where I think miscalculation will potentially originate. There is a "face" issue for China and how it will resonate with the domestic audience if its actions are deemed too soft given its perceived growing strength and the general insufficient recognition of its intrinsic status by Western powers.
If you look at the big picture, there's great power politics in Asia for the first time since Mao accepted US primacy, and FON, TPP, strengthening US alliances, RCEP, AIIB, Belt-Road, SCO, etc., are all pieces to answer Barack Obama's central question of who leads Asia, and in what capacity.