I'm playing as Japan (I find it hard to play as Germany now without Di:G!) and my 7 subs there were chewing up the Chinese convoy system. I think they were down to only a few left by the time I took all their coastal provinces.
I too would love to have the ability to hand out conquered territories, like you could in HoI 2, to your allies. Since that is not part of the design though, I don't think it will work with Di:G but would need a change from Paradox. I did however have the event choice to give Mengkukuo some extra conquered territories I had taken. I don't know if this had anything to do with the new war goals feature or not.