I still have a very hard time chalking it up to racial bias, whether conscious or unconscious.
If the NBA is lacking in Chinese players, I'd amount it to:
1. Chinese players' talents aren't good enough, or they simply don't fit into the NBA style of play
2. NBA teams are not good at transcribing their play to the NBA level
Lin is an American, however, and has been playing US-style basketball his whole life.
Lin's had a streak of statistically good games, and a much larger sample of below average play off the bench. I haven't watched his games and I don't know how good he is on defense, or how he looks in operating an offense. But even if he turns out to be a really great NBA player, it's not like he was the first professional athlete to be overlooked/underrated. John Starks, former Knick, who played a big role in the Knicks' success in the 90's was undrafted, as was Ben Wallace, a premier defender for the championship Pistons in the 2000's.
The NFL also has a lot of once underrated talent. The Super Bowl losing Patriots have future Hall of Fame quarterback Tom Brady, who has been an elite quarterback for about a decade now was the 199th player picked in his draft class. And one of his prime targets the past few years has been undrafted Wes Welker. Kurt Warner was undrafted, sign as a free agent, cut during the preseason and had to play several years in the Arena League before becoming a Super Bowl MVP and superstar quarterback.