Comics

State ownership under a capitalist state is not socialism, correct. Private ownership under a socialist state is not capitalism either. You are entirely missing the point of Engels in Socialism: Utopian and Scientific. Socialism is a transitional mode of production and distribution between capitalism and communism, characterized by social ownership as the principal aspect, ie rising and dominant, aspect of the economy and the working class as in control of the state. Both apply to China right now. The path of socialist construction in China utilizes a Marxist understanding of economics that sees the material basis of markets as decentralized and underdeveloped production, and the material basis of planned economy as highly developed and centralized production.

China maintains social ownership of the commanding heights of the economy which have already reached monopoly scale, and employs controlled marketization to accelerate the development of underdeveloped industry to create the basis for social ownership through development. The CPC stands at the top, a working class party with a strong basis in Marxism-Leninism with Xi Jinping Thought, and uses this dominance of the state to restrict the capitalists from forming a politically unified and coherent class that could undermine this socialist construction and derail it.

Here's a diagram of that "stages of socialism:"

They are currently developing towards the intermediate stage, with plans to reach it by 2049. That means they are already socialist, just developing towards higher stages of socialism.

As for independent unions, why is the independence of a union from the socialist system a good thing? There is already a massive federation of trade unions, independence from this creates a fulcrum by which the capitalists could leverage against the system. You have a liberal idea of socialism that envisions it as just as disunified and disorganized as capitalism, but socialism is a process of collectivizing. Capitalists are barred from the highest levels of the CPC, and are prevented from ever having a large presence in it.

nationalized industry under a capitalist mode of production just turns the state into a collective capitalist

Besides the fact that Engels saw "state capitalism" as he defined it as a positive, final stage of capitalism (he was wrong on that since the transition to socialism has always occurred in feudal countries, not in the core countries where capitalism is strongest, but that discussion is better suited to lemmygrad or hexbear), as Lenin and later socialist leaders noted, state capitalism has different potential definitions:

“For socialism is merely the next step forward from state-capitalist monopoly. Or, in other words, socialism is merely state-capitalist monopoly which is made to serve the interests of the whole people and has to that extent ceased to be capitalist monopoly”

• Marx

“The state capitalism, which is one of the principal aspects of the New Economic Policy, is, under Soviet power, a form of capitalism that is deliberately permitted and restricted by the working class. Our state capitalism differs essentially from the state capitalism in countries that have bourgeois governments in that the state with us is represented not by the bourgeoisie, but by the proletariat, who has succeeded in winning the full confidence of the peasantry.“

• Lenin

None of these socialist thinkers meant the term to be used in the ultraleft definition you're using, as a tool to demonize actually exist socialist states and decry them as "not socialist enough".

China's economy still runs on wage labor, commodity production, capital accumulation,

Good, developing the productive forces, building a thriving socialist market economy and putting that capital to use to serve the whole people, is the goal of every current socialist state.

massive billionaire class extracting surplus value

As I linked below, the PRC is a mixed economy, where the publicly owned and planned sector predominates, and there is also a restricted private / capitalist sector. I don't expect an ultraleft to be familiar with the "bargain" strategy, but having a capitalist sector within an overall planned economy, has resulted in the export of tech and production to China, with it becoming an economic powerhouse and primary trading partner for most of the world, and real wages rising 4x in the past 30 years alone. The limited and short term wage exploitation in the private sector (in reality, its a small expense to buy off private capital and keep them operating within the socialist legal framework), has under a socialist government resulted in those incredible economic gains, whereas the capitalist 3rd world is still writhing in poverty, and completely at the mercy of western finance capital.

Plus, you can't claim the working class controls the state when independent unions are banned, strikes are suppressed,

False. The PRC even supports more strikes than nearly any other country, which clearly irks the western finance rag I linked. Also, people don't have much reason to strike because of the people's congresses in nearly every workplace, and the wages rising so much recently. They of course don't allow US-sponsored strikes and slowdowns, which do happen occasionally.

private CEOs literally sit in the national legislature

A small number of them do, which of course is a good thing if you want to make sure that they're working towards the betterment of the country, and to avoid them organizing an opposition. Regardless, they do not control the state, and capital has no enshrined rights, especially to organize.

If you're going to demonize socialist countries in the future, at least post sources for your claims.