As far as I know, the ONLY entry to China that is legal for non-Mongolians/non-Chinese to enter is at Erenhot, north of Beijing. Last year a friend of mine tried to exit through eastern Mongolia and was refused, when he tried to do an end run, he had a most interesting confrontation with the Mongolian army/border guard guys that started with several AK-47s in his ear and a hard ride in a military truck to the appropriate port of entry/exit mentioned above.
Maybe check with a Mongolian Embassy to verify legal exit points.
Jack
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On the road,
Jack & Janet
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