Short answer: it was more accessible and cheaper to play.
Also, here's a detailed post of why China likes it so much:
https://www.reddit.com/r/kof/comments/6dh0gb/some_insight_as_to_why_china_loves_kof/
It helps that SNK made really good fighting games in general. Its popularity is well deserved.
To add to that:
One piece of evidence
Sari
mentioned in his
huge SNK writeup was
KoF 97 Douyu Cup, held in 2014 (500 000 viewers peak. biggest FGC event in terms of viewership). I would like to focus on that detail, since I am also familiar with Douyu (the streaming service).
Now then, the important factor is that the Douyu Cup's numbers start to approach that of the BIG League of Legends and Dota 2 events. That's saying a lot, because LoL and Dota 2 are
massive in China. Sure, LoL's way bigger by far - especially by the time Worlds rolls around. But Dota 2's The International (their World Championship) still
comfortably pulls in millions of viewers on Douyu, Huya - one of its competitors - and other Chinese streaming platforms.
Now, the big finalés are another story. The International 2018's Grand Finals between LGD (Chinese) and OG (European) drew around
13 million Chinese watchers (scroll down to Statistics incl. Chinese platforms). Despite taking place in Vancouver, a bad time slot for Chinese people. And although the Chinese viewer data hasn't been released yet for The International 2019, and no Chinese team featured in the 2019 Grand Final (LGD finished 3rd instead of 2nd, and OG faced off against Team Liquid's European squad), The International 2019 took place in Shanghai, which should mean a further increase in viewer count.
The 2018 League of Legends World Championship Final on the other hand has an even crazier claim. Sure, it took place in Seoul, a pretty Chinese-friendly timeslot as opposed to Vancouver: but the contest between iG (Chinese) and Fnatic (European) apparently drew
200 million Chinese viewers. At least 110 million viewers on the same streaming platform. What the frick. Even if we decide these numbers are frauds and slash all of them by a certain percentage, it will still be major league numbers.
Still - the fact that KoF even approaches the big MOBA numbers is a
really, really good sign. I'm pretty convinced that if a SNK fighter is indeed revealed for Smash, there will be a major league hype train in China.