Lu Xun was influenced by the ideas of Charles Darwin and his theories on evolution. He applies these ideas of evolution in Diary of a Madman by incorporating themes centered around cannibalism and a its overall effect in returning society to primitive structures. Xun's novella focuses itself in the mind of a handicapped man and his struggle to discern reality from dream. Although Darwinism can definately be applied to the cannibalistic side of the story in the imagination of the main character, I don't believe "survival of the fittest" is relative outside of the author's imagination.
There is no doubt that the narrator of the story is mentally handicapped, and so when we analyze the story from his point of view, signs of Darwinism are definately present in the society that he has dreamed up. Cannibalism is a perfect example of a society that has gone awry, and as you could imagine "only the strong will survive." In his mind the narrator believes that his community has regressed into a primitive society that practices cannibalism, and unfortunately for him, he is deemed the next weakest person community - ultimately a death sentence.
However, when we look at this story from a literal sense and not strictly from the point of view the narrator presents, we realize that cannibalism is just an illusion. The narrator only convinces himself of this crazy idea because he is going mad himself. It is illogical to believe from a conscious state of mind, that any society would revert itself back into these primitive ways. Many of the examples the author gives for coming to a conclusion that everyone in his society have become cannibals are completely ridiculous when analyzed from a literal sense of mind; "...how do you explain those dirty looks the Zhao family's dog gave me? I've got good reason for my fears." Another sign of his madness is displayed by his reaction to the doctor that comes into the room to help him. The narrator completely convinces himself that this man too has become a cannibal, and is only there to make sure he is ripe to eat.
In conclusion, I believe theories of Darwinism are only relevant to this story depending on how you look at the text. If you simply follow what the narrator is saying without question, then there are definate signs of "survival of the fittest." However, if you look at it from a more literal sense of view, you will realize that this man has simply gone insane and is conflicted with a extreme case of paranoia.