True - if Moscow is captured by Axis forces - and The Allies fail to recapture Moscow in the same round - the War is over and The Axis win.
There are 3 different Winning Conditions in the Axis & Allies Global 1940 House Rules Expansion.
1. Military Victory: Capture an enemy Major Capital and hold it for 1 complete round of play.
2. Economic Victory: The Axis must have a combined IPC level at 148 IPC - and The Allies must have 189 IPC.
3. Surrender: Either side can surrender at any time due to a hopeless military situation.
We chose to eliminate the concept of Victory Cities from the OOB Winning Conditions - simply because we wanted players to have more options to win the game, instead of always fighting around the same Cities and Areas.
With the Winning Conditions described in the Axis & Allies Global 1940 House Rules Expansion, the Warfare becomes much more flexible on both sides.
The Capital Defense rule was play tested back in 2013 for the first time.
At that time, we still hadn’t fully play tested the Army Group rules with the Global 1940 2E.
So we decided to wait with the Capital Defense play testing in favor of the majority of other rules that were included in the Axis & Allies Global 1940 House Rules Expansion.
Concerning the German Luftwaffe we usually see around 30 % serving on The Eastern Front - and the remaining Luftwaffe units in Europe & The Atlantic.
It all depends on the German Strategic Plan.