Hm, I don't think that is a good idea. The Germans aren't stupid, they'd certainly let the French state have a French name! Besides, it look wierd alongside all the Anglophone countrynames.
Some German puppets have Germanised names as Vaximilian already mentioned. Mittelafrika and AlgOstAsien for example. On the other hand, maybe this French state shouldn't have German name because the proud French population wouldn't like it to much. The only thing which bothers me with this French puppet is that it's so generic. What exactly means this ''France''? We have Commune of France and National France, but German puppet is named just ''France''. There could be something connected with Charlamagne maybe? Some kind of cloned Frankish Empire, which had many Germanic elements. There are Brittany, Normandy and Occitania also possible to release after conquests of France and those countries are known from Middle Ages. Germans like old tradition and they could make some kind of this France too.
After all, decision is for modding team. There's nothing more to do as only flag/shield replacing and changing name. Small cosmetic change, literally.
By the way, here's another proposion for team. I know this is so easy that everyone can change this himself, but it would get more weight if team would decide for this option.
What about renaming Germany into German Empire? This nation is meant only as empire. This would mean also Communist and Republican minister cabinets could be removed and used for other German states. German Empire cannot get communist or republican since the flag would have to be changed with political changes. France could also have an option to release united German state if it's victorious, something like DDR, if player wouldn't like to split Germany between Bavaria, Prussia and Rheinland.
Just few suggestions, KR team has probably more important work to do now, but if you like ideas, you can use them.