…thinking aloud about it, maybe overly simplistic, but I agree on the idea to keep it simple.
the entry of USSR and USA would be the crucial points. if you setup a timeline for their entry, like the aforementioned Xeno play, with a certain number of turns till entry or attacking of any of a particular set of territories to bring them in.
for USSR, maybe turn X, or the attack of any SU territory, places like Persia, or chinese territories within 2 of SU, or even put places like turkey or Afghanistan into play and make these marks.
entry of USA could be amphib assualt on Britain, Brazil, or Australia or turn Y.
-they could also receive percentages of their normal income until these occur.
instead of all the minor countries added, I’d think they could fall under the UK’s control, as they’d be the only Allied power in play from the start and they are already either connected to or in control of most of these places in the game as it stands. Most of Africa is UK controlled, even though France and other European countries had colonial control/influence there. It would be similar to how Germany assumes the control of smaller Axis-nations like Yugo.
The play setup could allow Germany to attack Poland or France on G1, and not invade SU until later, or else UK could utilize the Polish troops for example.
I’m not familiar with the ‘Diplomacy’ rules but I would think that the diplomacy of the game could be as simple as you attack and we’re enemies or you don’t at we aren’t. Much of what the Axis power-grabbed was allowed simply because the rest of the world didn’t think it worth the effort to step up against it.