Hate to say I told you so (well actually I love it), but repeated below is my post mortem post from our game. See point 1.
"This Axis Strategy is essentially as follows:
1. Prioritize Advanced Aircraft tech and also research Long range aircraft (more important than many people think)
2. Build the Manstein HQ ASAP,
3. Build all your Fighters, Tanks, TAC and, if possible, HQs prior to DAK arrival (I believe this is pretty standard anyway),
4. Get Spain on the Axis side, preferably by diplomacy,
5. Send Manstein to Libya to join Rommel (well actually even before Rommel arrives)
6. Use the Luftwaffe on mass, first to take Malta, then Egypt, then Russia. If necessary also use the Luftwaffe on mass to take Algeria and the Middle East.
7. Don't be afraid to "operate" the Luftwaffe to wherever it is needed.
8. Don't rush Barbarossa. Generally speaking, the only time Axis MPP production is greater than Allied MPP production is from the fall of France until Barbarossa.
9. When using the Axis Air Force, generally concentrate on destroying the enemy's fighters and HQs first, not the front line units. I often neglect this one myself.
10.Once Leningrad, Moscow and Stalingrad have been captured, destroy whatever unit is in London with the massed Luftwaffe and then drop a paratrooper. Game Over."
I believe this is the strategy that Sugar used in this game as well. The only difference is that he was perhaps a bit laggard in getting Spain on his side. Of course, it is not just that Sugar has a great strategy, but that he executes it perfectly (or close to perfect anyway).
The funny thing is that almost all of that is wildly ahistorical. If real-life supply issues wouldn't limit or prevent it (even just getting supplies into Sicily so as to bomb Malta to oblivion would have been problematic), then real-life brute force constraints would (there are only so many bombs you can drop). I too can (post-the fall of France) easily and quickly nuke every British air unit in range with my massed bombers and Stukas; if it were that easy, then the Battle of Britain would have been a total cakewalk (vs. the Stuka being quickly pulled from front line units).
Someone really needs to work on a more historical scenario with realistic constraints, where possible/moddable/scriptable.