But once you have gone to the trouble of deciding to support a new language/market, such as China, the production cost of making translations available on all your offerings is virtually nil. In the code settings it's most likely a set of a parameter settings within a unified codebase. The language pack option suggests that apart from a little install space, its not a difficult change.
The core logic here is economics and profit maximization. Software has a high up front build cost, then a virtually zero marginal cost to produce future units. Copyright is a government enforced monopoly. Piracy is the non-monopoly free-market price of software based on its marginal cost of production (ie free, or simply the the cost of CD media plus retail markup).
Profit = (Price - MarginalCostPerUnit) * Quantity - InitialCosts
Assuming no piracy, For each individual there is a maximum price they would be willing to pay for the product before they would choose not to buy it, or to switch to something else. A business running a standardized Windows setup would, if forced, likely pay a very high price for more copies of Windows as long as its less than the cost of switching their entire setup. A chinaman with access to torrents is likely only to be willing to pay a small fee to "go legit".
The laws of Supply and Demand in market economics means the quantity is heavily dependent upon price for a given market. A lower market price means more people will find the market price less than the price they would be willing to pay, overall it can increase profit, but it comes at the cost of making less money on all the previous units sold (this is known as poisoning previous sales).
In a perfectly price discriminating market, everybody would be haggled up to the maximum price they would individually be willing to pay. This is not possible. But the average American has a far high disposable income than the average Chinese. Thus you maximize profit by selling to the rich Americans at the price they are willing to pay, and to the chinese at the price they are willing to pay, and make it very hard for the chinese to see their copies to the Americans.