It's funny that Googlers like to cite China as proof AOSP is really a thing and that competition exists. But the only reason it works is that as you point out: Google exited China. It's impossible to compete with an illegal monopoly, but we can easily see how much better the market works when Google is gone. So Europe and Russia's argument is, AOSP will thrive when Google (or at least, their blatantly illegal contract terms with OEMs) is gone, of which I agree completely. I'm sure Russia would be more than happy if Google left on "moral grounds".
Android's lack of Google services in China isn't because Google "exited" (and by "exit", means moved servers to Hong Kong), it's because the great firewall blocks them. If you take a phone purchased in Europe or the US into China, Google Play Services won't work without a VPN.
Do you think the Great Firewall is an example of "how much better the market works"? You know, where BAT (Baidu/Alibaba/Tencent) are the oligarchy who controls everything? Have you tried Baidu's search? It's terrible, even for searching for information on the Chinese mainland web.
Your "see how much better things work?" is that 600 million phones are shipping with worse versions of Android, with worse security, lots of malware/spyware, and government censorship.
I suppose thats a victory for the investors with Baidu stock, and Beijing's thirst to control the flow of information, but it doesn't look like a victory for consumers to me, or an example of "markets working"
Having not used phones in China, I won't comment on quality, but at the very least, it does prove the point: The only place Androids not controlled by Google exist in substantial number is where Google is banned. Not exactly a shining argument for your claim Google isn't a huge antitrust problem.