I tried your G3 neutral crush, however I was playing Europe 1940, not global, and I have a few notes. The only variation I played here was if UK fell, they didn’t surrender all of their money and kept playing with Canada as its new capital (which actually worked out very well and stayed balanced).
As Germany, I purchased 2 transports and 2 submarines (in hindsight, a cruiser might also have been a good buy, or a bomber just the same). I used all my planes in some sort of naval combat coupled with submarines and the surface fleet. I got lucky with the dice (but I did also plan out the attacks well) and eliminated every UK fleet in the Atlantic except for the carrier and the other ship at Gibraltar and the one off the coast of South America. In turn I lost 2 submarines and 1 fighter from the combat. All of my planes landed in Holland afterwards. I had to make sure all my transports would be in the baltic rather than the atlantic side of Denmark because 3 fighters vs 1 damaged battleship and a cruiser (2 subs there but the UK planes cant hit them) could easily be taken out and lost all 3 transports and ruined Sealion. Anyways, the ground forces moved into Paris and left Normandy alone for round 2. Also, I invaded Yugoslavia with the Infantry from Southern Germany and any tanks that couldn’t reach Paris this round (was 3 of them and 1 artillery).
UK countered with 9 infantry in London and did the Taranto raid on Italy, though they lacked much teeth after that and just kind of hung out in the med with the French ships to cancel Italy’s NO.
G2 I landed a successful Sealion with 3 transports, using something like 3 infantry and 3 artillery. I lost 3 infantry, 2 artillery and 2 more fighters. We decided to then do the alternate capital for the UK and Germany just went up 6 IPCs with no IPC spoils. This is where I saw an opportunity to do the Neutral crush. UK had no transports on the board except for from the med which now retreated to the Red Sea and the horn of Africa, Russia and the USA were not in the game yet and can’t capture neutrals while still being Neutral. So I decided to set up for Turkey and Spain, while Sweden would come in time since it was safe from Capture, I also noticed if I played it right I could get units into Iraq on G4 and hit Persia/Saudi Arabia if necessary with the extra infantry. Units from Yugoslavia moved into Bulgaria to be ready for Turkey while Italy didn’t make a move yet for Egypt they remained in the Eastern Med for support from their 1 remaining transport. All of the Paris units would take Normandy then G3 would do Spain.
Fast forward to G5 or 6 (can’t remember now that I am on the computer), Germany had a small factory in Yugo for the Russia push (never got around to doing the Afrika Korps NO) but started to struggle a little with units on the Russian front. I still think Russia would start losing ground but they had Leningrad stocked up really well. I do know that I was 1 turn from taking the Stalingrad factory, thanks to an Italian factory in Turkey (yeah they took it when I meant for them to soften Turkey up for Germany). USA landed in Portugal and Morocco. most of the german subs have retreated due to USA weilding 5 destroyers in the Atlantic with a couple bombers for support. Interestingly enough, the UK’s carrier lived long enough to regroup with the South America cruiser and retreated to the US coastline, then grouped up with a token UK fleet built from Quebec. They should be now getting back into the fight here soon enough. Italy did so well against Turkey that when it came time for Egypt, they fell flat on their face. only making 22 with not a single NO (french destroyer still hanging out at Gibraltar after fending off 3 german subs) has been difficult to spend any money on a fleet outside of a sub or two to eventually clear out the med.
All in all? I hit so many neutrals and early enough that I made my money back, the downside is that I have a very very long coastline to now defend from the awakened giant. And every unit I build in Normany, France or London is one less unit vs Russia on the shrinking German stacks of Infantry and Tanks. I utilized my airforce so much that it now only consists of 1 bomber, 3 Tacs (but one is in London for helping take out ships with the subs) and 1 fighter. Overall I am optomistic about winning once Stalingrad falls and I rebuild a stack in Germany to push back, but I may have to let the Allies take Spain or UK just so I am spending money on one less place.
In short, does the strategy work? I would say yes under the condition you take out all of the UK transports, still have a decent Air Force and you get a good stack ready to march into Turkey and Spain. Sweden was easier with 3 transports but I also had to use Infantry gained from Finland that were already earmarked for the Baltic campaign. I think when we quit, Germany was making 76 a turn with 2 NOs and Italy with 22 a turn, UK with 22 or so and Russia at 24. everyone is so worried about the allies picking up a handful of free infantry when they really dont have the infrastructure to pick them up, atleast not for 2-3 turns if not more, in which Germany can make 7 IPCS extra a turn, (+1 for Portugal if you get there, +2 for Iraq and +2 more for Saudi).