Interesting conversation on the potential for conflict in our region.
For my two bobs worth, while China has a clearly articulated desire to reclaim Taiwan, their leadership has a greater desire to remain in government. That ability to remain in power has always been predicated on improving the standard of living of the population (the do what we say and we will make you wealthy principle). This is what avoids a revolution, and the government deeply knows this.
I would suggest that the Chinese government recognises that, while there is a marginal opportunity to defeat Taiwan, the cost is likely significant and the population will feel it, potentially enough to make people respond by rebelling enmass.
I'm sure the Chinese government has seen the mess that is Ukraine, understand that conquering a county in three days is not a realistic outcome, and see that Russia is being slowly bled dry with no reasonable exit ramp. I'm sure this gives them pause for thought.
They would also see the problems dealing with asymetic defences, and despite America's chaotic politics, will note one of the few galvanising issues in America is an anti Chinese sentiment.
I think they are also starting to note how countries around them (including Australia) are turning against them, consolidating in aliances and rapidly arming.
Putting all that together, I would view that they consider the best way forward is to continue be belligerent, bullying and engage in sabre rattling across the South China Sea (i.e more of what they are doing now). It goes down well internally, keeps others on edge, doesn't risk economic/political collapse, continues to fund the military (a powerful polical group in their own right) and may possibly wear external opponents down. I would consider they will continue this strategy, pushing it as hard as they can without triggering an actual hot war. They can maintain this approach with a declining population and economy for as long as they want. It keeps the status quo, which means they stay in power.
So the most likely end outcome is another cold war (and I would suggest it has already started), just this time in our back yard rather than Europe. The previous one lasted for 45 years, so military buildup/modernisation strategies need to last over this kind of time frame. It's a marathon, not a sprint.
From a western point of view, provided that China is always presented with an outcome that leads to the economic destruction of their population, then a hot war is likely to be avoided
Bringing it all back to an Australian Navy 2.0 relevant theme, I don't see a major concern with the shipbuilding program presented recently. It's a commitment to investment over the medium and long term, with the material benefit occuring over the 2030's and into the 40's when this cold war will still be ongoing and probably reaching its peak. And it will give us an ability to act autonomously in our region.
In the short term the deterrence burden is going to be on Japan and Korea (both of whom are substantially more advanced in their defence modernisation programs) plus the US, with Australia coming online later. Others such as Indonesia, Vietnam, Singapore, and the Philipines are all doing their bit, just more to their budgets.
My point is that I view the future as a fatiguing siege, rather than a quick blow up, hence less need for ships and other gear now. Our better current investment is setting our industry up to maintain a strong navy (and army and air force) over the next 50 years.