AFAIK there aren't any exchanges in mainland china, so everyone there has their crypto in offshore accounts that aren't subject to such regulations.

Pretty sure it's still illegal for Chinese citizens to use them.

So with this recent announcement, it's super duper illegal for them to use it? That's not really much of a change from a few weeks ago.

No, it was never illegal for private citizens to use them before, they just banned the exchanges. Now any transaction is illegal.