This really does look like the final blow in the war between Google's Search Engine and the censorship-loving Chinese authorities: The sword has fallen, severing all access to Google Search from inside China. Even the mobile site is being partly blocked.
According to the Telegraph newspaper, in "almost every major Chinese city" users are reporting back that they simply cannot access Google's search engine results, even via Google's Hong Kong work-around. The government demands that companies comply with "self-regulation" censorship rules, and Google recently made good on its threat to stop censoring its service inside mainland China—part of a series of events that began with an allegedly Chinese-based hack attack at the end of 2009.
Exactly how China's intercepting the system isn't clear yet, but it looks like despite being able to reach certain online Google resources, tapping in a search query merely results in an error message page (the most cowardly form of response, almost—at least an honest "This page is censored" banner would reveal to the population that the Great Chinese Firewall had been in action.) Google's also reporting that some of its mobile search services are being censored too, indicating that the government may be trying to close this potential loophole as well.
Add in the fact that reporters are being restricted about what they can write about Google, that the "Chinese Facebook" Renren has taken down its Google company page, and that the Great Firewall has even cut off access to a Chinese translation of Google's own blog posting explaining why it was going to violate the censoring code, and it looks pretty terminal for Google's Chinese search endeavor.
Perhaps unsurprisingly, the turgid Chinese government dug its heels in deeply on this matter. The most we could've hoped for (in a general "go free speech!" kind of way) was that China would turn a partial blind eye to Google's uncensored Hong Kong trick. Nope. The last remaining question, which will be debated to and fro for months now, is "Did Google do the right thing here?" or was its own stubborn last stand, supposedly a pro-free-speech one, actually not quite as honest or positive as it could've been?
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