It sounds like he's saying this is not an abuse of the central government, but by a local one. I doubt VPNs are illegal in China in general.
This is a gray area. While people said that the law is only about illegal physical network gateways, in reality the government did sentence people providing VPN services. I think the point they want to make is that even if this is illegal, the penalty in this case is kind of ridiculous.
No one got arrested for building & releasing open source VPN software on github.
If they really want to get you on something, using vpn won't be the good excuse anyway as the max penalty is way too low. it is like $100 fine plus maybe up to 2 weeks in detection. in fact, 2 weeks detection for using vpn is unheard of, a few days is already extremely rare.
It is like jaywalking & argued with the driver on the road which cause the traffic to be stopped for 1-2 minutes kind of offense.
It’s more like being prosecuted for “Treason and jaywalking”.
It isn't binary. Whenever the Supreme Court in the USA makes a ruling on a 1st amendment case, remember that China has exactly the same amendment in its constitution. But ya, law interpretation and enforcement fall down, especially with respect to shoplifting and drug use, things that would be dealt with strongly in China (because context) and less strongly in the west (because context).