Is it legal for China Bank to refuse to exchange old dollars?

Yes, you can change it. It may be because the exchange standard of broken foreign currency is evaluated more strictly by the superior bank than that of RMB, so the small outlets will grasp the exchange standard of broken foreign currency more strictly. It is recommended to go to the business department of the first-tier branch of the local bank and exchange it at an institution with large foreign currency circulation. As long as it is real money, you can complain to customer service.