Apple didn't hand over any encryption keys. They are stored on Chinese servers, per Chinese law.
Apple can't legally protect Chinese users from their government the way it can in this country--for now at, least. But Apple can protect Chinese users from other malicious actors.
From Apple's point of view, it was either refuse to follow the law and leave all Chinese users to the general security and privacy shitshow that is what every other phonemaker has to offer, or, play by the rules and give them something that's better in every use case except for the one where their government wants to hurt them.
Your argument is that locking your door can't stop a SWAT team from breaking into your house, therefore people selling locks don't care about keeping your house locked. It's a weirdly simplistic and uninformed argument coming from someone who claims to be tech-literate.