"But there was nothing about Conservatism or Republicanism in the 1930s that flirted with fascism at all. As has been said, the more likely result would be an isolationist US - which admittedly would be less fun to play (only thing I can think of is make it more economically powerful, in exchange for being bound by waiting for foreigners to attack you). But even while you're dismissing the criticism that its not playing to modern stereotypes, you cite it in your argument."
Well, yes, and the Democratic Party wasn't about to jump into bed with the Soviet Union, either.
If we're holding strictly to history, there's obviously no way that the US was going to transition either to communism or fascism in the timespan of the game, so some fictionalizing was required to allow the player to experiment with those branches. In that respect, I think emphasizing, and exaggerating, the "classically" left- and right-wing tenets of each party (which are not "modern" and had been established well before the setting of the game) worked fine.
To debate this further, we'd really need to define what American fascism and communism would look like. I don't think they would resemble Germany's or Russia's, but it wouldn't make them any less fascistic or communist. I think if we did that, we may very well find more theoretical links to extremist ideologies buried in 1930's America.
But...that's more typing and research than I'm really ready to commit to right now.