First, I am assuming competence on the US part. Based on how competently they fucked Europe up in the last couple years, I am assuming they’re not completely stupid, despite what many anti-imperialists on the internet are saying.

It's not so much that the US is incompetent (although there's definitely plenty of incompetence to go around and the current US political class is nowhere near the political competence of the political class immediately after WWII) but that the US is an irrational actor if we understand a rational actor in the context of geopolitics to be an actor that focuses on self-interest and has long-term agendas that it wishes to pursue.

Being a rational actor itself isn't good or bad. China is a rational actor, probably one of the most rational actor in existence today, and its foreign policy is very much a product of it being a rational actor. This is why it simultaneously has the BRI and pays lip service to anti-imperialism while at the same time has normalized relations with the Zionist entity, partly to use Israel as the middleman in order to procure US military tech. Everything that China does is calculated for the sake of its own national self-interest and for the sake of its long-term plan. In contrast, Ansarallah isn't a rational actor at all. The rational thing to do would be to issue a bunch of anti-Zionist/pro-Palestinian statements while ensuring the Saudis and Emirates through backroom channels that they would do nothing substantial to help the Palestinians. Instead, they pretty much torn up the detente they had with the Saudis by launching cruise missiles at cargo ships. That's because their guiding ideology for international relations isn't realpolitiks but political Islam, which is a completely different paradigm. Therefore, we don't have to read tea leaves when the Yemeni military states that the attacks will continue until the blockage in Gaza is lifted, but take them at their word. This is a good thing.

So if the US doesn't fully embrace realpolitiks in the same way China does, then what is its guiding ideology? I would say that part of its guiding ideology is white supremacy. US society is completely build on white supremacy, so for a bunch of geopolitical wonks to say, "well, we made it all the way without addressing our white supremacy, but for the sake of crafting reasonable policies against China, let's temporarily turn off the white supremacy switch in our heads so we can impartially analyze China." It doesn't work like that. Another key ideological component is triumphalism over winning the first Cold War. When you combine the two, it becomes, "We beat the Soviets. These bug-brained Chicoms are even more pathetic than the Soviets ever were. We totally got this." And among the stereotype of Chinese people is that they are incapable of creative ingenuity which leads to your second assumption.

Second, I am assuming that the US is very well aware that they cannot possibly stop China’s technological advancements and eventually surpassing the US itself. This lesson was already well learned when Huawei beat the US in 5G technology years ago.

I would argue that their ideological commitment towards white supremacy and self-aggrandizing triumphalism means that they are very much not well aware of this fact and that plenty of the US political class still believe that the US can continue to surpass China. I'm not making the argument that the entire political class or even the majority of the political class believe in this delusion. But if something like 17% of your political class continues to believe that China can't innovate and just steals IP, well that's a dice roll and if you roll a 1, your senior heads will enact policies that operates under the wrong assumption that China can't technologically surpass the US.

So how did the US pull off the vassalization of Europe? They were able to pull if off because it was the rational agenda to pursue, and since everyone involved is European from the British to the Germans to the Ukrainians to the Russians, none of the white supremacy ideological blinders is applicable, which means the US was able to accurately assess all the players involved. But for China, the US will attempt to pursue a rational agenda, perhaps pursuing the gameplan that you've outlined, but there will be plenty within the political class that want to take advantage of the inherent bug-brainess of the Chicoms and pursue a completely different plan and in the process, fuck up the hard work of the rationalists.