I can't reply to your reply so let me do that here.
In Netherlands, the government wants to reduce emission, so it incentivizes people to isolate their homes better, and to use heat pumps instead of gas heating. On the other hand, if you actually try to install a heat pump, you'll run into all sorts of regulation issues: the unit can't be too big, there are only a few specific places where you're allowed to place it, a ton of people can object to it, permitting takes years if at all. Oh and if you isolate your house, then voila, during the current heat wave it's a constant 35 C in your home. So you try to install AC and you run into permitting/regulation issues. So you then use a super inefficient portable AC that just barely lowers the temperature by 3 C and uses 4x more energy, and that's fine. facepalm
And the government and banks also want to combat money whitewashing, so they incentivize people to use digital payments and discourage cash. Police could look at you suspiciously merely for having too much cash on hand. On the other hand, NATO and also a bunch of government agencies are warning about war and encouraging people to have lots of cash at home for emergencies.
"They" do not "clearly" want one or the other. Different government branches can have different, conflicting priorities.
The Netherlands is tiny. China has 1.4 billion people, and its state apparatus is orders of magnitude bigger. Forget about coordinating the population, even coordinating the tens of thousands of local government bodies has always been a huge problem. All the previous dynasties have said that governing such a large country is a nightmare.
Xi is not personally in charge of the censorship bureau. The top government sets broad direction and KPIs, while local governments and government agencies are given a lot of leeway for implementation as they see fit. And frankly you cannot run a large organization any other way — there is no large company in the world where the CEO micromanages everything without burning out. The KPI is "social stability", and as long as this is kept and there are no grave problems like corruption, it's not the top government's job to dictate how the censorship bureau do their work. Of course, you may be of the opinion that something like "freedom of speech" is more important than "social stability", but the point is that they value "social stability" more, and that they're motivated by that, and by not some idea of "suppressing freedom". This ties directly into my point of properly understanding them.
Furthermore, many people tend to be risk averse, and would rather instinctively deny something than to take chances. There was a famous scene in the Jiang Zhemin days in which Jiang said something frank in some meeting with a foreign politician. Then the cameraman was like "uuh should we record this?" and his boss was immediately like "no, cut it away". Then Jiang said "why shouldn't we record this? of course this should be recorded!"
This risk-averse attitude is still pervasive in a lot of places. It's not just DeepSeek that's "paranoid", everybody implementing censorship rules is paranoid similarly. On Xiaohongshu/RedNote they don't want you to talk about societal issues at all, even "positive" things like "I think Taiwan belongs to China" — they recently banned a Taiwanese's account for saying stuff like that, they want you to focus on travel and food or whatever. This attitude likely won't change until the current censorship bureau generation retires, and gets replaced with the next generation that's more confident.
Finally, whatever Poland did pre-1989 has absolutely nothing to do with China. There are no similarities in motives or circumstances. You can't just lazily lump random Soviet-era countries together with China just because you give them both the "communist" label. China's adaptation of and motivation for adoption of communism is wholly different from the Soviet Union.