Been checking the FAQ and it seems to say that Iceland is indeed part of Europe.
What is the general strategy for china? Usually it gets wiped out in our games unless the U.K. comes in early to help, but that leaves it vulnerable for the Japanese to take Calcutta. Any ideas on what is best to do as china?
Declare war on Japan on R1 and send mech units into it to help. You should be able to do this for at least 4 Turns. Even 2 units a Turn helps.
Some people DOW Japan as the UK on T2 and pile 10 Inf into Hunnan to keep the Burma Road open. All depends how close Japan is to India. Can always retreat the UK units.
Keeping India is obviously the most important factor, as you have mentioned.
or you could pull everything back to Shensi and see what happens. Kill any Japanese ground units that you can.