Yes, China is morally wrong in covering up protests, because freedom of speech is important for a citizenry to make sure that they are not oppressed. Chinese people need to be able to have a way to know what their other citizens are thinking. Public opinion is important so that citizens can collectively decide where they want to take their society. China is morally wrong to oppress this.
Covering up or otherwise hiding civil unrest and protest within a country is morally wrong. The rest of the world has a right to know how the citizens of a country react to the leadership of the country, in order to better judge the country in question. By covering up such activities occuring within a country, the country is misrepresenting itself and its population to the rest of the world. For these reasons, China is morally wrong.
By covering up protests they are taking away the rights of their citizens by trying to control them. It should be a basic right to speak out against your government to try and effect change. By not allowing a peaceful protest I believe they are infringing on that basic right. And it is also equally wrong to try and pretend that the protest never happened in the first place.
Yes, China is wrong. Why? Because when a government covers up a protest they are pretending that everything is fine. There is an attitude of 'nothing to see here', in a world where every person in the developed world has a cell phone with a camera. These protests cannot be covered up and China is foolish to think that they can actually keep these protests under wraps.