Yes you're correct, I forgot to add the fixed fee, however, China Merchants Bank only charges 0.5% fee (min. charge RMB 10, no other add on fixed fee), so for a $500 withdrawal, assuming $3 ATM operator fee, the net costs will be $5.5, or 1.1%. For larger withdrawal, use Bank of China as it only charges a flat fee of 15 RMB/transaction. Here is the fee schedule from Unionpay Canadian website:

Cash Withdrawal Fee from Overseas ATM with Unionpay Debit Cards

Bank of China
RMB 15 per transaction

Industrial and Commercial Bank of China
1% of the withdrawal amount + RMB 12 per transaction; the minimum is RMB 13 and the maximum RMB 62.

Agriculture Bank of China
1% of the withdrawal amount +RMB 12 per transaction

China Construction Bank
1% of the withdrawal amount + RMB 12 per transaction

Bank of Communications
1% of the withdrawal amount + RMB 12 per transaction; the minimum is RMB 15.

China Merchants Bank
0.5% of the withdrawal amount per transaction; the minimum is RMB 10.

Shanghai Pudong Development Bank
RMB 18 per transaction

Hua Xia Bank
First transaction each day is free; then: RMB 12 per transaction

China Everbright Bank
RMB 15 per transaction

China Citic Bank
RMB 15 per transaction

Postal Savings Bank of China
0.5% of the withdrawal amount + RMB 12 per transaction; the minimum is RMB 14 and the maximum RMB 62.

Shenzhen Development Bank
RMB 10 per transaction

Guangdong Development Bank
RMB 15 per transaction

China Industrial Bank
RMB 16 per transaction

China Minsheng Banking Corp. Ltd.
RMB 15 per transaction