Street life

Outdoor gyms
This article presents the outdoor exercise equipment that is now all over the capital. It is widely popular, and gives the elderly one more thing to do in their free time, and one more way to stay in good shape. A little more on the subject here.

Table tennis
Needless to say, table tennis is for China what football is for Brazil. You find tables everywhere, and people play all the time. They are sometimes places in the outdoor gyms, sometimes stand on their own. Wherever they are, they enjoy lots of attention from the locals.

Popular with all ages, you will see people playing this anywhere there is space available - in parks, schoolyards, in front of apartment buildings. It is played with what resembles a large plastic shuttlecock.

Tai Chi
You would see people exercise in parks in the mornings. The slow movements are usually accompanied by music. Luckily for all those who haven't had the chance to go to China yet, some nice people make videos like these and these of such events.

Flying kites
Chinese people like to fly kites everywhere: in parks, on squares, on bridges. Sometimes there are so many people flying kites at the same time that it is amazing how they manage to stay out of each other's way.

Ballroom dancing Beijing style
Not that Chinese people do not have proper ballroom dancing, but they also like to dance like that in the streets, in parks, in university gyms and basically wherever they can. I was invited once to one of these regular happenings at a university gym, where everything had been put away and with an average age of 50, people danced away happily the entire evening.

In the morning and in the evening you would often see people dancing in parks (video, video). They would all repeat certain steps and everyone is welcome to join.

Yang ge
Middle-aged ladies enjoy dancing with huge fans in bright colours (called yang ge). It is another activity you can observe in parks.

The popular online game has very little in common with the actual game of Mahjong. This Wikipedia entry has quite a lot to say about it.
Typically a gambling game, it has lost some of its charm, as gambling is outlawed in China. Friends would play with small stakes, and there would be places where you can play properly, and completely illegally. In this video you can see it explained well (audio is not too good).
They say that it is hard to learn, easy to play. Here is a guide to the rules of mahjong.

Weiqi (Go)
This game, as opposed to mahjong, is easy to learn, hard to play. It is a game of strategy and you need a lot more than a knowledge of the rules to win. 
This video has a short presentation of the rules.

Opera singing in the parks
Chinese people do not feel that singing is something that should be done in enclosed areas or when performing at a concert. They would sing anywhere they please, anywhere they find appropriate, like in this video.

Water calligraphy
People would use huge brushes to write on the ground in parks (video, video, article) Once dry, the characters disappear.

Bird - walking
Often where there are cricket fights, you will also see the bird owners, sitting under a tree with a cage hanging from the branches. Eventually another old man will show up, hang his cage next to the other one and then the birds will keep each other company while the men chat about this and that.
I once watched a man who had let two birds out of their cages and would occasionally call out to them if they wandered off too far away from him.