Where can I buy porcelain crafts in Shanghai?

You can go to Yuyuan garden. There's a big market there selling Chinese crafts, gold and jewelry, such as porcelain tea sets, pottery vases, sculptures, paper cuts, jade wares, calligraphy arts and etc. But you have to be good at bargaining, otherwise you'll be for sure overcharged.
You may also do shopping online. There're many online stores selling porcelain crafts at lower prices, while unfortunately most of them are only in Chinese.