I don't think they speak Chinese, as the player character can understand them just fine, technology wise they are one of the more high tech factions in the game, and they don't dress or act like Chinese remnant army.
For the ending, there are two offical ones. Form ending faq from gamefaqs.com
http://www.gamefaqs.com/computer/doswin/file/63576/10946
The Shi, demoralised and leaderless after your rampage through
their town, slowly drifted apart. They blended into other
towns, hoping to find a place free from the depredations of
killers.
How to get it: Format the president computer.
The Shi flourished, creating a botanical scourge on the
radiation surrounding their beloved town. Though this vine
could not grow in other soils, the Shi took care to nourish it
in their lands. They continued to grow in strength and
prominence, forming the basis of a new empire.
How to get it: Don't format the president computer.
There are other actions, like giving them veritbird plans etc that doesn't appear to affect ending narration at all.. But overall which path you get depends on Chosen one's alignment. If the Chosen one is canonically evil, then Shi is most likely smashed, if not, then Shi forms a new empire. As for which one happens depends on the developer.
Personally I think the second one will be official, mostly because it will make more interesting game if Bethesda ever decide to use west coast.