From: Northwestern Georgia, USA
rroberson, as one who's been there, I can tell you there is light at the end of the tunnel. I've suffered devastating carrier losses early in the game, but the Allies do indeed always manage to come back...as long as the commander in chief doesn't despair but rather converts over to a very patient and resolute approach. And coming back from the brink of despair is always sweet.
GJ is right about China. It's tough (not impossible) for the Allies to defend pretty well, but when it falls the game isn't over. I think crsutton can speak to this as well as GreyJoy. And GJ is right - only fight in the mountains or wooded-rough terrain. There's lots of it in China, so find it and use it.
It is incredibly unlikely that he will try to pentrate through the interior of Oz further than Alice Springs. Supply would be a nightmare for him.
Don't know what Scenario you are playing, but if it's 2 or something similar, your opponent might be cooking up additional bold plans. It would worth your time to prepare an exhaustive list of every division Japan gets in the game, which ones start restricted, and what info you have about the current location of each. That will help you evaluate where your opponent is concentrating and when the danger of further large-scale operations is over. IE, if your opponent commits 10 or 12 divisions to Oz or India, etc., then at that point you know that other major targets are relatively safe since he can't be everywhere at once.