Yep ... sounds like the dogs have been snapped right off ... if it was a selector problem or gear teeth missing you'd cop crunching ... or you'd at least feel a pulsing movement thru the shift lever as the dogs go into and pop out of the holes in the mating gear ...
Motorcycles have constant mesh trannies ... meaning the teeth of matching gear sets remain in mesh at all times ... the slider gears which the selector forks ride in the grooves of ... simply disengage the dogs from a free wheeling gear on one shaft ... and re-engage other dogs with a free wheeling gear on the opposing shaft ... Each gear set has one gear splined or fixed to a shaft and the other is non splined to allow that gear to go slower or faster than the shaft ... The dogs do the job of the spline when they are engaged in a gear , thereby connecting a given gear set to both shafts to change the gear ratio ... IF the dogs break off a gear ... you cop a false neutral for obvious reasons ...
IF the shift forks ever get bent or snapped off after the shift lever has been forced during a stack ... it's possible that two gear sets can try to engage at the same time ... in that case something would have to give ... ie one set of dogs would HAVE to snap off ... or gear teeth would be stripped ... or the gear shafts would be forced apart splitting the cases ...
If the dogs snap off cleanly ... there won't be any fine metal particles or shavings in the oil ... Forks that are worn thin can also cause the dogs to fail ... but you'll get a warning period as they wear ... and you'll definitely notice metal particles in the oil ... Unless you got the bike second hand and the previous owner flushed all the filings out ... In that case check for signs of banana skins too ... LOL ...
Some earlier model Lifan and Jialing engines did suffer from false neutrals due to a dodgy shift star and a weak detent spring ... so the shift drum failed to stop in the correct position sometimes ... causing false neutrals ... If the shift star is loose the same thing can happen ... but in those cases the false neutral is intermittent ... NOT constant on every single shift ... plus they caused missed down shifts as well ...
Most of the problems were in engines that had a 1 down 3 up shift pattern ... not in 4 up shifting trannies ... That's WHY most engines are N1234 now since 4 up is the most reliable and positive shift pattern ...
The most likely scenario would be that the dogs which engage second gear were snapped off during repeated hard shifts ... The ratio jump from 1st to 2nd gear is huge in these engines , and that creates a big impact on the 1-2 shift dogs ... Poorly synchronised clutching or not using the clutch at all is also bad for the dogs ... I've had a good look at a brand new Lifan 140 tranny which is similar to 125 trannies and some of the dogs are weak compared to a Honda XR75 tranny ... One gear is so small in diameter that the dogs are severely weakened by tooth grooves having been chopped through them ... I couldn't believe what I was seeing ... it's crazy ...