Yeah that makes sense to me, and really seems to make it fair in my opinion.
The three territories I always said Japan needed to take and keep from China were Manchuria, Kiangsu, and Yunnan. A necessary victory city, and IPC rich territory capable of holding and Major IC, and a highly strategic and NO based objective territory, beyond that everything else was just upkeep.
I think in the long run for Japan though it would be cheaper to keep the transports on hand to shuck infantry back and forth from Japan as if the territory gets over whelmed they would lose the IC there, also the transports could be used to rapidly redeploy units from China if such a situation arose.
In the end it’s really just a way to keep Japan from exploiting the Chinese movement restrictions to massive effect. The only other thing I could think of would be to give China separate win conditions, like once China liberates all of its original territories they win and Japan can never attack them again and nobody can move through their territories anymore.