I work and live in China, run a lightning node from home, and regularly cross the border with a hardware wallet and a phone with LN apps. Possessing Bitcoin that was obtained legally is NOT a crime and is protected as property under Chinese law. Attempting to sell Bitcoin as a company IS illegal, but doing it as a person as a form of barter is a grey area - as you are taking a risk that the other person may have illegally obtained money. Nonetheless it’s widely done in underground networks in China with Bitcoin and stablecoins.

The seed phrase should stay outside of China. If they ever forced me to hand over the crypto at the border, they could keep the hardware wallet and I’ll even give them the pin and passphrase to a small wallet containing a few hundred bucks ($5 wrench attack). My lightning node is on a server with a locally encrypted drive and backed up abroad. They can keep the server and if they are truly jerks they could keep the phone I use to access it.

Just buy a separate hardware wallet? Avoid crossing borders with a seed phrase to a significant cold wallet. Lightning nodes should contain small funds. If you are running the node from your phone with significant channels and want to avoid any potential disruption, it may be best to get a separate phone. Your relatives will need an App Store abroad and VPN to access LN apps. Happy to help further. I hope you help spread the word on Bitcoin.