Kung Fu Hustle made 100mil back in 2004. And yeah Crouching Tiger Hidden Dragon made 200mil when it came out here. Successful Chinese movies can happen. It just really depends on what the movie is. Obviously, Americans aren't going to be as familiar with Chinese culture and yeah, subtitle tends to be a barrier.
You used Hong Kong films as an example (The latter had Taiwanese involvement). Much harder to really get those through if they were pure Chinese productions. One of the ways Hong Kong tried to capitalize on Jackie Chan's rise after Rumble in the Bronx (an edited Hong Kong release) was to release some previous films after some editing (Supercop has been released years before as part of the
Poilce Story series. Ironically, it wasn't long after Rumble in the Bronx came out did the Hong Kong movie industry go into decline.
Operation Red Sea and the Wolf Warrior films tied very much tied to the concept of "The Great PLA fighting on behalf of the Chinese people" against evil. The latter has the "evil" as corrupt Americans while the former could be seen as a way to justify the Chinese responses to Islamic terror. The restriction of foreign films coming into China and requirements to promote Chinese culture tend to work in their advantage.