I left a school. Did a 'runner' and there was only one requirement to work for a new school:

A 'release letter' from THAT ORIGINAL school. The catch is they didn't have to provide it until a full year later. And I couldn't get officially hired and the Z-Visa for the new place until the old Z-visa expired.

I did not need an original diploma (in fact, I had to get a family member to photocopy mine back home and email me the copy. it was acceptable).

But yes, the bad school you are with can wait until the end of your contract (however many months remain) before needing to give a 'Release Letter' to whatever new school.

As near as I can tell the good news is they will be obligated to do it. Say you start at a new school. Their staff can even demand that 'Release Letter' and the bad guys pretty much MUST give it. The New guys can eventually phone the relevant PSB and get them to demand it.

But you don't need all the 'Release Letters' from all your previous years. As far as I know you only need 1 release letter - the last one. The bad guys WILL give you one. They may hate you but they must do it for the government rules and because they are giving it to the new employer (whoever that might be).

Anyways, everything else you mentioned is pretty standard in most training centers in China. The more they fail, the worse they are, the more mistakes, cheats and abuse they are giving = the more they will condescend to you, devalue you, blame you, accuse you and treat you poorly. This is a 'Chinese mentality'.

I hope you dump them. Tell them they suck and are abusers and shamed China. Then come here and name them. Then we will repeat their name enough times so that google remembers their name.