Step 5 Assign alliances
There will to be two alliances "Aggressor" and "Status Quo" The Aggressor alliance is attempting to reorder the world through military force, while the Status Quo is trying to resist that.
As I am not trying to track the ideologies you can assume that unlikely alliances are probably the result of ideological conflicts and similarities.
The first step is to determine the lead aggressor. The lead aggressor is randomly chosen from the major countries. The lead aggressor goes first and will receive more units.
Next the lead status quo power is chosen from the remaining major countries. The lead status quo power receives extra resources.
The remaing major and medium powers are randomly assigned as follows
50% Status Quo
30% Aggressor
10% Victim
10% Impassable
The "Victim" nation is a passive member of the Status Quo alliance. It is neutral with regards to the rest of the Status Quo alliance and at war with the Aggessor alliance. The Status Quo alliance can't assist the "Victim" but if the liberate a territory they don't need to return it. Each turn the lead Status Quo power receives a bonus of 1 PU for every Victim-held territory. Note that is major or medium power has been reassigned to the victim nation, that means it is in civil war or some other internal disorder.
The "Impassable" nation is neutral to everyone and out of play.
There is a 50% change of delayed entry of each Status Quo nation and a 25% change of delayed entry for each Aggessor nation (other than the lead aggressor). The delayed entry nation comes in a randomly chosen turn between 2 and 5 at the start of the lead aggressor turn. It is possible that every Status Quo nation is delayed entry, allowing the lead aggessor to focus on victims.
Historically, there was one territorial dispute directly involving major & medium countries, Alsace-Lorraine. Ethnically German but historically French it would be difficult (but not impossible) to resolve the dispute and conflict is likely. There will be a 30% chance that Germany is lead aggressor, while France is a status quo power that is active immediately. This will probably not work out well for France.