Good thoughts, these, but maybe a little excessive. I'd say that if you have some means of getting out of China quickly if necessary- either with your own funds or help from family and friends- and the ability to feed and house yourself in the meantime, that's probably close enough. I would never claim you required total security in order to work in China...just don't be in a position where you have to accept an abusive job.

I wouldn't worry too much about breach penalties. ('Breech' penalties, I guess, would be fines paid for being the rear or lower part of something? ;-{) ) I think breach penalties exist primarily to give schools a semi-legal means of keeping your remaining accrued pay if you bolt on them early, and you're very unlikely to have to pay that full amount...especially if the school is in breach of contract as well.