I’m honestly not sure why you think there’s a direct contradiction between “kung fu movie” and “treats Chinese people as people.” I mean, the vast majority of kung fu movies are, in fact, Chinese, made by Chinese people, and primarily aimed at Chinese people.
But, yeah, it’s not “just” a kung fu movie. But there is kung fu. And wuxia. And Marvel CGI animated super fights. And CGI monster fights. It’s an action movie. There is also family drama driving the plot, but that plot is driving an action movie.
As to representation, it’s an MCU movie with a Chinese hero, a Chinese villain, and supporting cast that is overwhelmingly Chinese, or Americans of Chinese descent, or
apparently extradimensional beings who are culturally Chinese and played by actors of Chinese descent and are pretty much indistinguishable from actually being Chinese.
For me personally, it was kind of disappointing that they tacked so hard away from Shang-Chi’s comics portrayal. I get why they did it - they were concerned with reactions exactly like yours.
The comic book version of Shang-Chi was created in the 1970s as pretty much a cross between Bruce Lee and Kwai Chang Caine from Kung Fu (so, pretty much the character from the alternate universe where Bruce Lee played the lead in Kung Fu). He definitely played into some stereotypes, and his characterization could get pretty cringey.
In the movie, they pretty much throw all of that out, and make Shang-Chi just a Normal Guy trying to live a normal life who gets dragged into a convoluted action plot. And, again, I get why they went that way, but for me personally, it made Shang-Chi just kind of a bland, forgettable character.
Similarly, the Mandarin in the comics, especially in his early appearances, was kind of a cringey, “Yellow Peril” stereotype, and pastiche of Fu Manchu but with technomagic power rings. I get why they wanted to get away from that characterization. But the character they wound up with was so far away from the Mandarin, I’m not sure why they even bothered with the idea Xu Wenwu is the MCU’s version of the Mandarin.
With all of that being said, if you don’t like kung fu movies, you probably won’t like Shang-Chi and the Legend of the Ten Rings - it’s definitely got kung fu and a lot of the DNA of a kung fu movie. If you do like kung fu movies and that’s what you want from this movie, I think you’ll be disappointed, as it drifts away from being a kung fu movie by the third act. If you don’t mind kung fu, or enjoy it as an element of a movie, you may like Shang-Chi and the Legend of the Ten Rings more than I did.