Chinese pronunciation is approximated by a spelling language called Pinyin. The letters are the same alphabet as English but pronunciation is Chinese. Thank you in Mandarin (the official language, so says the government) is spelled "xie xie" in Pinyin. That "X" is not like "sh" of telling someone to hush. Pull your lips back against your teeth, keep the upper and lower teeth slightly separate and put the tongue against the teeth. Now try to make a softer, gentler "sh" sound followed by "ee-eh". This is all blended into a smooth diphthong, not separate vowels. It can be doubled, "xie xie xie xie" much like "Thank you, thank you." Two common variants: Add "ni" (meaning "you") to get "xie xie ni", making it more emphatic, a bit like "Oh, thanks so very much". Add "ah" (no meaning except softening or "fine") to get "xie xie ah". The last two characters are so closely spoken that it often sounds like "xie xiah". This is the most common pronunciation I have heard in my three years in both western and eastern China.
The clasped fists are not seen often and represents a friendly, traditional gesture on meeting, greeting, thanking or leaving. It comes from a method of showing that no weapon is in hand.
Gratitude is shown in much the same way as westerners would. For big thanks, dinner at a restaurant can be hosted by the grateful person or couple. A gift of liquor or jade is common in western China, delivered in person, unwrapped, at the home of the one being thanked. Gifts in eastern China may include jade or a bottle of red wine but usually exclude liquor.
General gratitude for a business relationship or help by an educational advisor to a graduate student might include gifts for the children of the honored one rather than or in addition to gifts for the honored one himself, such as books, clothes, CDs or DVDs.