But the major foreign affairs policy initiative under way is the "pivot" to Asia, meaning against China. Most of humanity is "our" enemy, including the larger portion of the domestic US population. Turning the Mandarin into a big fraud perpetrated on the US government isn't nearly as honest as a big fraud perpetrated by the US government. An audience member who insists can still interpret the ten rings logi with its Arabic script at face value, but the story says otherwise. I think that's about as decent as you're going to get for a summer blockbuster movie.
I personally would have had a real Mandarin of sorts, a US citizen of Chinese descent from a Washington Beltway security thinktank operating an intelligence operation to subvert China on behalf of the US government. And everyone of the ten rings a development of Stark technology. And the name would merely have been a nickname from Stark, as he mocked the academic credentials of the villain. Stark could simultaneously have been loose cannon, prima donna, lone man against the establishment, the establishment personified and hero taking responsibility. Neither of us got the Mandarin we preferred.
You're right about Jarvis and Extremis. Whatever Extremis was in the comics, it was hasty and derivative in the movie. As for Jarvis, I think I would have cast David Hyde Pierce. Talking to any real human would have been better.