1. The diplomatic system plays well, but doesn't give particularly historical results. Examples:
France can easily build its entire force pool early in the game and still have plenty of money for diplomacy. Since everyone knows France won't be in this game for the long haul, it doesn't make sense for France to try to win allies. The best use of all that money is to reduce German and Italian influence in various places.
It is very difficult for the Germans to gain allies in Eastern Europe.
It is very difficult to keep Sweden from turning hostile towards the Germans (which cuts off the supply of iron ore and costs the Germans 10 BRP per year).
2. The ground forces of Britain and Italy seem much more potent than they should.
3. It is very easy to achieve some things that never happened historically. For example, building the Italian aircraft carrier is trivial. As is building up a substantial Italian amphibious capability. Some this stuff makes Italy more interesting to play, so it is understandable why it was included.
4. Submarine warfare doesn't seem to work very well. Subs are capable of inflicting significant losses and it is very difficult for the allies to inflict losses on the subs due to the way the sea zones are laid out. Even if the allies want to commit to an ASW campaign, they just don't have the bases to pull it off.
5. Both games we played had interesting interactions between Italy and the allies. In the first game, the allies left Italy alone. Italy swallowed the Balkans and then went after Britain. In the second game, Italy wanted to be left alone, but Britian and France declared war in Winter 1939 and swallowed North Africa.
Neither result felt quite right. The second case was especially ahistorical. The British player (me) basically wrote off France (France will fall with or without British assistance) in order to try to achieve a quick kill of Italy. It worked, but it made me feel a little dirty.
The game feels well balanced and fun, but it just doesn't always feel very historical.
Our next effort for this game system (after a brief hiatus) will be the Pacific version, Great Pacific War. After that we intend to join the games together to play the entire Second World War!