Thanks for the good pointers Lao Jia Hou

I would like to emphasize that one of the biggest reasons for not wanting to pay big amounts of money in order to go legal is, that I have no private garage or safe indoors place to keep my bike in. I haven't looked into it, but I believe that in China, once the bike gets stolen, it gets stolen and you are not getting the money back (please correct me if I'm wrong).

3) It is illegal, and you risk losing the bike (at a minimum);
Does anyone have first hand experience what happens if and how often local police actually get interested of your bike registeration. I have read a hundred stories about police just waving to move on when they see a western rider, another hundred of police being interested only in license. I recently talked with a guy who is riding without license and without registeration and he said his contact with local BJ police was when they wanted to take pictures on the bike with him (well, who knows). But still. I'd prefer legal, but I don't want to end getting economically screwed for bike that could cover expenses for buying four illegal bikes if I can't even guarantee the safety for such bike in a city like Beijing.