With regards to the World Cup - it's not Iceland that should bother you. Iceland qualify through a different confederation so it's not directly comparable. You should be ashamed about Costa Rica and Panama - tiny countries with shit football teams who directly outcompeted the USA - that's the humiliating part.
China I've always found odd. Given the huge investment in making the country competitive at the Olympics it surprises me that they cannot find 11 quality footballers to impress on the world stage in the world's most popular support. People have tried to explain this based around culture in East Asia not being into football, or with explanations based on the average physical characteristics, but both fall flat to me. Football is enormously popular in East Asia - look how many of the advertising boards in the World Cup, Premier League or Champions League are in Chinese. And the real baffler is why much smaller countries in Asia have better football teams than China. North Korea has a better football team than China. It makes no sense to me.
The problem in the US is that access to the best training in youth leagues is determined by how much their parents are willing to spend. Some of the MLS teams have started academies, but they are way behind their European counterparts. As far as I am aware, most of the big international stars came up through the European academy system which is a meritocracy instead of being a pay-to-win system like the US.
As to China, I am also confused as to how they don't have a dominant football team. They could set up one of the premier youth academy systems if they chose to.
After googling world populations, what I am most surprised at is Brazil's population. I feel a bit silly because I had no idea there were that many people in Brazil. Now I see why they do so well in so many different sports, given the population they have to draw from. I have also heard people talking about Brazil being the next big economic upstart, and now I am starting to see why.