The current version of copyright law in the PRC is here. Art. 10 states what is protected, which includes the standard rights of distribution, copying, modification and so on (which makes software cracking illegal). Article 22 gives the equivalent of the Fair Use limitation on copyright protection:
a work may be exploited without the permission from, and without
payment of remuneration to, the copyright owner, provided that the
name of the author and the title of the work are mentioned and the
other rights enjoyed by the copyright owner by virtue of this Law are
not infringed upon
for 12 specific reasons (translation into Braille or a minority national language, free public performances, quotation to make a point end so on), which includes some potentially applicable reasons
(1) use of a published work for the purposes of the user's own private
study, research or self-entertainment
(6) translation or reproduction, in a small quality of copies, of a
published work for use by teachers or scientific researchers in
classroom teaching or scientific research, provided that the
translation or reproduction is not published or distributed
(7) use of a published work by a State organ within the reasonable
scope for the purpose of fulfilling its official duties
It is unclear what "State organ" refers to and it is unlikely that a university is a "State organ". It is unlikely that (1) and (6) are interpreted as an across-the-board "education exception" to copyright, but that could be an avenue for legality. The standard misconception of copyright law is that anything done for educational purposes is allowed, and the PRC law seems to have at least the seeds of such a misunderstanding.
However... software protection is subject to separate regulation in Decree No.339 of the State Council, an English version being here. The regulations recapitulate the basics of copyright protection; software cracking is regulated under Art. 23, which says that
anyone who commits any of the following acts of infringement shall, in light of the circumstances, bear civil liability by means of ceasing infringements, eliminating ill effects, making an apology, or compensating for losses:...
(5)to alter or translate a piece of software without the authorization
Art. 24 continues, saying that it is forbidden
(3) to knowingly circumvent or sabotage technological measures used by the copyright owner for protecting the software copyright;
(4) to knowingly remove or alter any electronic rights management information attached to a copy of a piece of software
That covers cracking. Article 30 covers the situation of someone using pre-cracked software:
A holder of copies of a piece of software that neither knows
nor has reasonable grounds to know that such copies are infringing
ones does not bear liability of compensation but shall cease
the use of, and destroy, the infringing copies. Nevertheless, if the
cease of use or the destruction of such copies is likely to
cause heavy losses to him, the holder of such copies may,
after paying reasonable remuneration to the software copyright
owner, continue to use such copies.
A mere user who is discovered simply has to stop, unless they should have known that the copy was illegal in which case they would be responsible for compensating the rights holder – I have no idea what the standards are for having reasonable grounds to know.