The hardest part about Japan is their feeble economy. China is easy to conquer. Even the Island campaign is not so hard against the AI. In MP, Japan can be brutally difficult. Even with house rules that don't let the American's build up their Pacific defenses during peace time, Japan only has about 6-8 months to make progress before the Americans shut them down and start driving them back.
I enjoy MP Japan but I feel like my role is to be a distraction so the Allies commit assets to crushing that me that would have been better used elsewhere.
There are a lot of standard practices to which I find Japan to be the exception. For example, I quickly upgrade to infantry equipment 2 and 3 with other majors, but with Japan I stay on tier 1. They simply have a gerater need for the steel elsewhere. Certain support companies I will forego as Japan because the aluminum is badly needed for aircraft.
Agree about economy and managing resources. You have to be very careful in what you add to a template because the Navy and air force have has first priority to resources. Hospitals, logistics, and maintenance are really not possible due to lack of aluminum and rubber. Rifles 2 and 3 take steel needed for ships. And unfortunately steel and aluminum is in Russia while oil and rubber are in SE Asia. Getting to the point that Russia and refineries are looking better than going against Allies first.
Specialized units are important. Marines are a must and mountaineers extremely useful.
Engineers are a MUST in almost every division to allow fast movement and better attack. Recon is useful in attack divisions.
Make 15 LARM regiments and add 1 to 15 INF divisions to use vs China. Easily affordable with a few MIC, you will make up the production time with a faster China kill. You will cut thru China like a hot knife thru butter, China has no piercing. Then add them to 5 motor divisions for use elsewhere in Asia, these will be speedy overrun units.
Artillery is optional in China, just not enough steel. Rifles are not. Make sure you have at least 10 factories making rifles. You and your puppets need them.
Be sure to grab the Manchuko steel, 40 steel for 1 CIC. Lend Lease rifles to them to slow autonomy.
Go farm xp in Spain. You need it to build templates for China. You can use the base 12 INF as your standard, you need a 20w marine/eng and a least a 6 w mountain/eng to pin the PRC. Your strategist won't be enough by summer 1937 and you can't afford to train for xp.
Pull all your garrisons in from the islands, no one is attacking you there in 1936. In SP same goes for Russian border, in MP it depends on the house rules. Use some of them to create marine and mountain, train them to Trained 0% only (eqp attrition), keep 10 to reinforce your invasions. You might be able to field some new divisions but it won't be many. You start in a big rifle deficit that takes time to dig out of.
Attack Shanxi and capitulate, THEN attack China. This makes the defense of the PRC problematic, or you can just pin the PRC while you rout China. The PRC will surrender when China does.
Use your Marines to invade either at Quingdao or Shanghai. Shore bombardment, air superiority, token ground support, and use your Fortress Buster general. Make sure you grab a port! Send your 2 starting motor Divisions and a few cav rampaging behind the river line, China will either have to run south or rip units from elsewhere to chase. Micro micro micro your invasion. Don't let the ai bungle it. With the new rules China struggles to put a rifle in each soldier's hand.
If China digs in behind another river after you invade, use your Marines and a couple of tank reinforced INF divs to crack it. The Chinese just crumble against a tank, they struggle to reach 1.0 piercing.
Peace Conference: Take the coast of China and PRC except at Guangzhou and puppet the rest to Reorg China. This allows RChi to have a huge manpower base (3.5 mil and easily boostable) and decent IC. They will make divisions and you can use puppet templates to build infantry from their manpower with a 10 INF/ENG template to garrison everywhere plus be used as fodder. Your building and lend lease will keep autonomy down enough.
Even with China conquered you don't have enough CIC, MIC, or NIC. You are going to be juggling infrastructure, base/fort, and IC construction all game. Your decisions in 1936-7 can come back to haunt you.
Afterwards you have to decide where you are going. You control who you attack in SP, choose wisely. In SP Germany is likely to need help vs Russia in 1.3.3, but that means you need to be building refineries in case you are cut off from oil and rubber. Even against the ai it is difficult to go in both directions. If the USA ai actually did anything Japan would be very stressed. In MP expect to be pressured, embargoed, and attacked as soon as the Allies can afford to. They will not wait while you play in the Urals Mts.