An interview with a retired Japanese Air Force rear admiral:
The admiral believes that an outright invasion of Taiwan from China would fail because China couldn't control the sea lanes between the two countries for logistical support for the troops it would land. He also thinks that a blockade would fail, because Chinese submarines are easy to detect.
Needless to say, he predicates these outcomes upon intervention by America and Japan on the side of the Taiwanese.
UPDATE (Nov 17/05): Interestingly, the former Japanese officer doesn't feel that the 8 submarines President Bush offered to Taiwan are needed. Wretchard at The Belmont Club disagrees, and thinks they're crucial.