Are ethnic Chinese from Taiwan still allowed? If so it's probably just about the US' geopolitical rivals not being allowed perceived competitive advantages.

I don't find any materials on ethnic prohibitions. There are a lot of problems with that. Among them, it would either fail to achieve the goal. For example, let's say there was a Turk born and raised in PRC and totally aligned with the CCP: prohibiting Han from working in labs doesn't work.