I do not understand Google's decision.
First, the Chinese people would be better off with google.cn, regardless of whether or not it's censored. If anything, having quality results for non-censored topics will help them build economic prosperity, satisfy curiosity, etc.
Second, the decision makes it difficult to tell exactly what is being censured. This helps the Chinese government significantly. The most dangerous form of ignorance is when we don't know what we don't know.
Third, Google had risen above the issue by indicating in google.cn search results pages that information had been censored. This is a powerful anti-censorship message with every search. Now it's gone.
It does not take courage to give up and pull out of China, it takes courage to design a system so essential that the Chinese government relents on its censorship rules.
In reality, Google is not winning in search in China, so rather than have to continually answer to investors about why Google can't manage to make a dent in the search market in China, Google can now claim that it has a noble humanitarian stance. As I've shown above, the stance is neither noble or humanitarian.
I can't believe there is nearly a rate of 100% of people in the west falling for this ploy.