Google looks worse the longer they keep censoring results. Once they made their decision, they should have realized that there was no point in "negotiations" with a government that enthusiastically shoots dissidents. They should have gotten all non-Chinese employees out of the country as discreetly as possible, then simultaneously turned off google.cn filtering and issued their public statement.
The folks working in the China office have extended families and lives that are rooted in their country. You can't expect to uproot everyone, and for them to like it. Their action was appropriate. Because the China employees were left in the dark, they can say they had no part in it (important not to look like a dissident here), and they can leave while saving face.
The OP said "non-Chinese residents".
Wouldn't it look a little suspicious if they whisked out all the foreigners?
Google should obey the law. If they don't like the current law, they should work from within, talk to legislators, see if they can't drum up grassroots support to change the law.
Oh, wait....
Nobody cares enough about Google in China for there to be grassroots anything for it. They are the Yahoo of China. I know most Americans love to imagine that Chinese people are so horribly oppressed. It gives them comfort in the face of a rising economic power. There's lots of oppression going on, but internet censorship is grossly exaggerated by the American press.
Could you cite an example of exaggeration? Are Chinese citizens free to access any information on the internet?
Insisting Google obey the law when there is no rule of law is a little funny. No one else is required to obey the law unless it serves the party.