My group play A&A Europe with Italy this way:
Italy control N. Italy, S. Italy, Libya and Tunisia, a total of 8 IPC at start.
Germany control the rest, a total of 32 IPC at start.
Turn order:
Germany
USSR
Italy
UK
USA
We use the pieces and rules from A&A Anniversary ed. But with destroyers at 2 in combat value, the Brit set-up need 4 cruisers, or Germany need 2 subs less.
This pretty much fix the broken game. Germany used to buy 8 tanks against 8 russian infantry, and because of this they conquered Moscow in turn 5. Always. But not any more. The game is much more balanced with the A&A Anniversary rules and cost.
Also, to spice up the game:
The German army was very efficient because they used “Combined Arms tactic” and “Auftragstaktik”. So when german units attack or defend, roll all dice simultanesly, and then assign the hits to the proper units. Like germany attack with 4 inf, 2 tanks and 1 bomber. Roll 7 dice, and assign the 1’s to the inf, and the 3’s or less to the tanks, and a 4 or less to the bomber. The other army,s use the old Commanding system from Napoleon, so they roll all the infantry dice, looking for 1’s, and then roll all tanks dice, looking for 3’s or less, and so on.
In naval battles, the brits use the Combined Arms tactic, and roll all dices simultanesly, and then assign the hits. And the other navies must roll the old fashion system, column by column.