If there is no occupation of mainland soil it needn't turn nuclear. And it's not like the US or its regional allies have any interest in occupying PRC land.
I don't think that whether or not the US has an interest in occupation is a large factor in this risk. If the US attacked China, China would respond, guaranteed. That would lead to a full-on war. Unless the US backed down, a nuclear attack by one side or another doesn't seem unlikely enough.