Is there a separate queue for transit visa application at Shanghai airport

Yes, there is. When you land in Shanghai the first thing you will do is to look after 24/144 hour visa free transit counter where you will apply for a temporary entry permit by presenting your flight tickets and your hotel booking confirmation. When you are granted a permit, you will head to the immigration. You will also hear that some travelers have obtained a permit right at the immigration, but the recommendation is that you look after the said counter to avoid any misunderstandings. Have a nice journey.