After watching Little People Big World a lot it is a tough call. Is it exploitation or using your "handicap" to make money? On LPBW they talked all the time about people having to take the elf, munchkin, etc. roles to get by. They weren't always happy doing it but it put money in the wallet.
Yes people treating them differently isn't right. People doing things like "Dwarf tossing" isn't right. But if they are willingly putting themselves in a role like living in that city, who are we to say they shouldn't be. Of course since it is China, there is no knowing how willingly they are in that role.