I've discussed this many times. Technically, it isn't "never". They sent virtually their whole team in 2004 and also in 2002, both to the Korea Open and to the Asian Games in Busan. 2003 and 2005 there were next to no Chinese players, although Xie Zhongbo and Zhang Yawen were there as a relatively new pairing in 2005. Ironically, both times it was in Incheon, the only city in Korea that has anything close to a "Chinatown". This year, we did see some second-tier, like Chen Yu, Zhu Lin and Lu Lan, and even some first tier players like Bao and women's doubles winners Yang/Zhang. As for reasons, I'm not sure. It can't be the prize money because, as you say, Korea is always the top of the heap in that department. If you're thinking of Korea being "close" to Beijing meaning that makes it convenient, I don't think the difference in flight time to Southeast Asia is that significant. This year, players from many countries sat out either the Hong Kong or Korea Open in an effort to avoid injuries prior to the Worlds.
In any case, lest this thread stay off-topic, I can assure you that the Koreans' absence from the China Open was not some kind of tit for tat way of getting back at China. All the players mentioned at the top of the thread - LEE Hyun II,PARK Sung Hwan ,SHON Seung Mo, LEE Yong Dae, JUNG Jae Sung, LEE Kyung Won, JUNG Youn Kyung, LEE Jae Jin, HWANG Ji Man, HA Jung Eun, HWANG Yu Mi - were in Gimcheon last week for the National Sports Festival. This is a sort of national summer games and so the schedule is not in any way decided by the KBA. Only LEE Hyo Jung was not playing there. She is still injured but is still hoping to play in the Asian Games.