It is important when you are working at a Chinese school that you have some information that you can use to discredit and humiliate your employer if the need arises.

Way to go, SB. I hope you have an attorney on retainer and your account is up to date. I'm certain the bereaved of the recently deceased will want to pursue litigation against you if their family member actually takes your advice and losses his/her life when 'humiliating' their boss.

A while ago I was working at a university and I was curious and a bit amused as to why the Chinese staff were giving me a wide berth, or the cold shoulder if you like. I asked a Chinese teacher I trusted why, he told me the uni was worried that I would destroy the reputation of that uni in that particular city. I liked working there, I was well treated, so I had no intention of exposing my boss in some way and making her lose face, but I could have if I wanted to.

Ah, but you see, you can't have it both ways. Once you've let it be known that you will lower yourself to any level to seek revenge, you do not get to pick and choose against whom you wish to 'tarnish' with your venom. Everyone will become afraid of you, and, avoid you, rightfully so.

but I could have if I wanted to

Loss of face, or even the perception of losing face is something the Chinese really fear, it is a reason why litigation in China still at a much , much lower level in China then in the United States for instance. If a Chinese person must litigate then it might be a signal that they have already lost face.

Ridiculous statement. China's civil laws and court system are in their infancy. Presently, it's a system that is by all accounts 'foreign' to the Chinese. Regardless, one can always hope that some of the students/staff at the school where you teach will see your post and in light of your very poor attitude towards them, scheme against you. I think I'd watch my back if I were you.