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How can a country who doesn't hold his own capital do anything except focus on taking their capital back? I sat and watched in amazement as they went back and conquered Paris before Berlin and while I held Berlin and they held Paris, they won????

Can you give more details on the comment? I am confused without understanding the sides involved.

I had basically three massive groups of units. I had one unit of about 30 units in the Netherlands (allied forces) and another one of about 20 or so in France. The Russian forces (controlled by me as well) invaded and conquered Berlin with about 35 units. The Germans had two major groups of units as well. They combined but rather than attacking Berlin like I expected they would have to, they teamed to wipe out my forces in France. After that, I lost production there, lost a landing spot, and the Netherlands was surrounded so when it was attacked on the next turn, they were wiped out. In the meantime, the Russians continued building in Berlin....the game ran out of time and I had assumed based on what I had conquered in Europe along with pinning Japan back, I would have at least a draw but since Berlin was conquered, I suspected I would win. In the end, it really wasn't even all that close.

Really, I think I have two problems. If a capital falls, the losing Army should not be able to do any attacking until they've secured their capital back. However, I take the capital conquest even further and say in that case in particular, the war for Germany would have been over.

speaking logically, why does a country need a "capitol"? if the leadership and industrial potential is all located in other places, what significance does a capitol possess?

I can honestly say that if anyone invaded the USA and sat in washington D.C. with all their troops, I'd say let them sit there and we'll go around them and destroy their industrial power and supply lines.

specific to the game though, you need to capture both east and west germany to knock the germans out.