Hopefully, someone else can jump in here without being executed on the spot. First, some general comments on the idea of the scenario, and then some responses to comment made.
The scenario idea is pretty close to one that I am working up to include Italy in the European game, but I am assuming the Fall of France has occured and Italy is then in the war. However, I am going to allow the Italian player to change sides if he/she can be persuaded to by the Allies, and also have both an Axis Italian player and an Allied Italian player, as actually occured. I figure that the difference in color between the Japanese units in A&A Pacific and the new A&A game will make that possible. I am going to increase the British Navy a fair bit, like two more battleships, two carriers with one fighter each, probably 3 destroyers, and two subs, with some of the ships in the Mediterranean. The US and SU will not be in to start with, but the US will be supporting UK with its convoy IPCs as a minimum, and also a really modified form of Lend-Lease that more accurately represents the program. If German subs interdict the US convoys, the US is in the war. Once the US is in the war, its IPC count doubles. The Italians get a battleship, a couple of destroyers, and probably two subs, and 2 or 3 transports, as units will need to be transported to Africa. Germany will get a battleship on turn 2 or 3 as a bonus unit. The US gets a bigger Atlantic Fleet. Iceland is occupied by Britain, and the troops there defend at 3.
I am not worried about the Italian battleship doing excessive damage as I use a different rule for ships and shore bombardment that the game rules. Basically, no infantry can be killed by naval bombardment, but the naval guns can support an infantry attack like artillery, without the independent roll. The same thing applies to aircraft. They cannot kill infantry, but only support ground unit attacks. Naval bombardment and aircraft can kill tank and artillery units. This more accurately represents what happened. I am still working on all of the other changes I plan on making.
Now, some responses to comments made here.
1. Not sure where Eschaton gets the idea that the Italians attacked Yugoslavia. They took over Albania in the spring of 1939, and attacked Greece in the fall of 1940. The UK diverted some of its very small Mid East assets to help the Greeks. The Italians never attacked Yugoslavia. The Germans had an easy time due to dissension within Yugoslavia between the Croats and the Serbs, one reason why they still hate each other.
2. With respect to fighters and the Stuka. I agree that it is weird for the Germans to use a Stuka as their fighter. The Bf109 and the Messerschmidt 109 are the same aircraft. The only other option for the Germans would be the Focke-Wulf 190. For the US, if you want a good ground support fighter, use either the P-47 Thunderbolt, or the P-51. For the British, use the Spitfire, as that also was used as a naval fighter. For the Russians, use the Yak 3 or Yak 9, as they already do. The Japanese already are using the Zeke.
3. As for the UK already being powerful enough, with 10 subs, the German player should be able to continue to control the convoy routes for quite a while, especially if the SU is not in the game yet. Without the convoy supplies, Britain is in severe straits. The Royal Air Force is also pretty small in the normal game rules.
4. Considering that Corsica is part of France, and Sardinia is part of Italy, I would hope that they would be considered as two separate islands. Sardinia was a major Italian airbase and naval base facility. Aircraft from there figured prominently in the Malta convoy battles.
5. In all of the Axis and Allies games, the US is severely unpowered economically. This is done mainly for game balance, as otherwise, in any kind of a long game, the Axis get smashed. Since I will be using this as a teaching device, I am less worried about game balance, and more concerned about historical accuracy. I want the Axis to be smashed if the Allies cooperate and play well.
If it is okay with Eschaton, I will copy his rules and see how they work. If there is sufficient interest, I will post my modification on the forum as well.