What is stopping players from buying from the cheaper exchanges and selling on the more expensive ones?
Time.
No really, by the time I buy on Bitstamp, it could take an hour before I get the Bitcoins to MtGox. And I may never be able to withdraw my USD from MtGox. Lots of people don't have any issues getting money into Gox. Getting it out is another question. It's a risk and liability.
And China is on the other side of the world.