A tiny minority of Chinese elites have indeed adopted one aspect of Western high culture (i.e. not spitting). Traditional Chinese culture involves frequent spitting. Deng Xiaoping was a regular user of the spittoon. (And don't tell me Deng wasn't educated - he was literate and the commanding general of the decisive battle that defeated Chiang Kai-shek's Nationalists). The issue isn't with the habit of spitting in the street - it's with spitting at all. Since the average Chinese is brought up to think of phlegm as harmful, the natural thing is to spit it out at every opportunity.
The problem is that education level throughout China is still very low. For every 10 million educated, there are 100 million uneducated. But hopefully that will greatly improve in the next few decades.
As you yourself wrote earlier, 90% of Chinese are literate. The problem isn't education levels - it's Chinese culture. Westerners have discarded the quack remedies of traditional Western medicine - the Chinese still cling to the quackery of traditional Chinese medical theory, out of racial pride. (In a world where 99% of what Chinese see and touch everyday is a Western invention, the blind acceptance of traditional Chinese quackery is a salve to wounded Chinese pride).Phlegm is bad for you, so you must spit it out. Since no one carries a spittoon around with him, and the cleanliness of the streets is anyhow not his problem, the natural thing to do outdoors is to hawk and spit out that loogie stuck in his throat.
Note also that what is said by self-appointed Chinese social critics and their official hangers-on in later periods doesn't represent Chinese culture. It is what the Chinese people do that represents Chinese culture. Besides, spitting is such an ancient Chinese tradition that to say it's not part of Chinese culture is like saying that leeches were not part of the Western medical tradition.