Fernando's suggestions are quite valid and I agree. However, setting up countries is the easy part. Giving your "world" life and meaning is where it gets tricky.
Not to discurage your effort, but it's a lot of work, and you will need to do the bulk of it yourself. Even if a lot of people volunteer, you need to merge all additions, search for errors, and do the "frontline" testing. In addition, you need a solid "game design" and a clear aim. So, what's your aim with this project?
With my own effort, (for HoI2) we tried to make an very accurate "world", as similar to our own as possible. This took an absurd amount of time, but we got it right. All the correct ministers, tech teams, order of battles, unit values and economic statistics. We began to loose momentum when it came to the story and events, but we eventually, we had literary thousands of them. However, we had no real AI, and the storyline didn't work as planned due to several hard-to-fix bugs. Most important, it wasn't really that fun to play. The events were portioned out between a LOT of countries, and it took many hours of playing time to reach the point where any major conflict broke loose.
I suggest that you don't follow the notion that "every nation should be playable and fun". In fact, I suggest that you make only one nation playable, but give it an engaging and thoughtful storyline, and take time to give it's opponents ingame a proper AI. Think phases, and not just "war between X and Y". An good example is Germany in WW2, where the war is distinctly divided into different campaigns and phases. Set objectives to the player, and instruct the AI to try to avoid the player to accomplish these goals. Give rewards and reactions of some kind for accomplishing these goals, for without them, the objectives will become meaningless. Also include multiple choices when it comes to objectives - nobody likes being bossed around, and it makes the mod worth playing several times. Just remember to make the player state it's objective in an event. (choose it) And link this choice to specific enemy AI files.
By "forcing" all the players to play as this one country, you get meaningful feedback from players on how engaging it is to play, and you don't alienate people by giving them a boring experience as a country without content or a worthy opponent in the form of competent AI. And those who are tech-savy enough to mod a country to be playable, will do so with the full understanding that it isn't meant to be, so any shortcomings there won't reflect negativley on your work. When, and if, you ever reach the point where people truely enjoy playing this country and are having a exciting challenge, that is without glaring bugs and shortcomings, you can add another country with the same level of detailed storyline, and AI to it's opponents.
And please, consider to make it no more than 1 year between the game start and the breakout of a full, major conflict. The game isn't meant to be fun in peacetime, the mechanics and gameplay options simply isn't there. We tried to cover-up this with many events, but it did not help much. Besides, the more peacetime before war, the easier the game will be for a human player, as the player are much better at building optimal forces etc.
Most of the "world" setup is already done in several other MDS's, so pick and choose what you like and modify it to your liking rather than wasting a full year (at least!) to create everything bottom-up. (just remember to ask for premissions and such, which I can't imagine anyone will decline) - You should spend time instead to create a thoughtful and exciting storyline.
PS: I think you can use decisions (those that are in a list as opposed to events that pop up) quite creativly. The DH team added a ton of new triggers and effects that are not even used in the main DH game.
And... having don't start out the war with NATO vs. a huge block of countries... draw them in one by one as the storyline unfolds! It will make things less overwhelming and manageable, and bring intrigue and evolve the story in a nice way. Don't be afraid to let countries switch side in the conflict if certain conditions are meet either.
Hope I didn't scare you out of this nice initiative, and the best of luck to you!
