Why do so many people here go nuts over very low quality gear from China?
Firstly, I don't think that everything that comes from China is garbage. Rigol scopes (and arguably the nanoVNA) are some examples.
However to answer your question, I think everyone would agree that equipment being more accessible to more people, is always a good thing. Nowadays you can have quite a good lab, with an amount of money with which you could not even purchase a single oscilloscope 40 years ago. So if a piece of equipment comes out, that previously was unattainable for hobbyists, people get hyped. Whether or not that hype is valid or not, depends on the quality of the product. A lot of these Chinese products of course don't come close to more expensive equipment, but can still do maybe 90% of what a hobbyist might need. In one word, it offers unrivaled price/quality ratio.
Their business model is to shovel as much low cost garbage as possible, to completely undermine the competition.
This is kind of generic for any free market. Either differentiate, do it cheaper, or do it better, or you will go out of business.
In any case, I do not see why it would be necessary to get upset about this, except if you somehow have a business in second hand electronic measurement equipment. Low demand for second hand quality manufacturer equipment would drive down the prices if you intend on buying those anyway.
They can do this because unlike businesses in other countries, they don't care about warranty, so their products don't have to be good
This is not true. If they do not make good products, people would buy similar products from other companies, because there are so many that essentially produce identical devices. Sure there might be very crap products at lower price points, but then you are essentially complaining that there are different price points for the same product. There are cheap and expensive cars too, you don't expect an ultra cheap car to be as reliable as a more expensive one.
nd they don't care about regulations or IP either, which means they can make those products for pennies
In terms of ethics, this is a valid point. The thing is that most people do not care who designed the original product and if they get money for it. They value a low price higher than that.