Not so - there are other types of IP aside from Patents - in the US: Copyrights, Trademarks or service marks. In addition - international agreements provide PATENT protection, especially the Patent Cooperation Treaty, of which China is a signatory:
"Several international agreements on patent protection exist. For substantive issues, the most important are the Paris Convention for the Protection of Industrial Property (1883) and the WTO Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) (1994), while the main patent treaty for procedural issues is the Patent Cooperation Treaty (1970)."
Here's a primer:
http://www.iccwbo.org/home/intellectual_property/presentation/wwh.asp
At issue here are a few elements: The iPod design / function - protected by patent. The iPod name, protected by copyright. There are international agreements for both patents and copyrights.
EDIT: some additional China-specific information: "On September 15, 1993, the Chinese government submitted its instrument of accession to the Patent Cooperation Treaty to the World Intellectual Property Organization, becoming a member state as of January 1, 1994. The Patent Office of China is China's agency dealing with cases involving the Patent Cooperation Treaty, performing international patent searches and preliminary examinations." http://english.peopledaily.com.cn/whitepaper/9(1).html
Now - enforcement issues in China are another matter.