For those of you who discuss the topic Germany/rockets/mini-nuclear bomb, please read this article, which also includes links to its right regarding the development of the V2 and speculations that the Germans did something similar of a nuclear test in march 1945:
http://news.bbc.co.uk/2/hi/science/nature/4598955.stm
Furthermore, regarding Germany's capacity to develop the nuclear bomb, it is plausible that it was not lack of resources that lead to the Germans not developing a bomb before the Americans, but partly the head of the project (Heisenberg) lacking the ability to develop the bomb, building on what the Germans knew (ahead of the Americans) by the early 1940s. Heisenberg's travel to see Bohr is famous, where the Dane Bohr refuses to offer any help to Heisenberg's project. Instead Bohr later travels to the US and take part in the Manhattan project. It is possible Heisenberg's misunderstanding about how much nuclear material was needed had the consequence the project was seen as impossible to finish in time for it to affect the war outcome. However, if you read this article about the production of heavy water in German occupied Norway (link below), the Germans should have had more than enough heavy water to build a nuclear plant capable of producing nuclear bombs already in 1942-43, had they had better knowledge of how to develop a bomb.
http://en.wikipedia.org/wiki/Heavy_water
Another issue is how the Germans really thought they would use nuclear power. I have read that after deciding it was not worth the effort to use nuclear power to produce nuclear weapons, that the development of nuclear power was researched with the aim of developing submarines that could use nuclear power to stay on missions for months at the time, which could have altered the Atlantic warfare. As someone else suggested earlier in this thread, Germany saw its submarine warfare as an essential strategy to make the UK surrender, due to starvation. Developing better submarines that could stop the merchant ships from the US to the UK and the SU therefore had key priority, and probably was seen as a much more realistic way to end the war than to develop a bomb which was beyond most people's imagination at the time.
In my opinion I think the Germans would have been well capable of developing nuclear weapons before the Americans had they had a senior scientist and a team capable of understanding how to make the bomb in 1941-1944. They had the heavy water to make a nuclear reactor had they produced it and transported it from Norway to Germany in 1941-43, and if its true that the u-234 submarine had nuclear material sufficient for two nuclear bombs, which was used in the bombs dropped on Japan (see link below), it shows that Germany had the material but lacked the skills, or focus, to put it all together (on time).
http://www.channel4.com/history/microsites/H/history/i-m/lastdays1.html
Regarding HOI3:
Yes, I think the AI should build nuclear weapons, but the usage and the effect should perhaps be more political than military. I am confident many human players will rush to produce nuclear bombs, and use them, after all you guys know an atomic bomb's significance. However, until the bomb was actually developed, tested and used, no one except a few scientists, politicians and officers had the imagination to understand the bomb's significance. For this reason I think a project aimed at developing the nuclear bomb should come as a 'special event' that unlocks the opportunity to develop such a weapon. Being at war, such as the US being pulled into the war after the attack on Pearl Harbor, being one criterion. Having an economy large enough so that starting such a project is seemed as a good investment, is another. I.e. if the production would cost X IC over Y years, then the country in question should have an economy where such a project would only account for Z % of its total gross domestic production (total IC). In this way "trigger happy" human players could not start researching nuclear weapons before the country is at war and also has a war industry where the opinion or leadership would see such a huge project as a legitimate usage of resources. Furthermore, a significant drop in IC, or the end of war, could cancel or slow down the project. The third criterion for such a project to start is the presence of a research team having the realistic capacity of researching the bomb. In the case of Germany there could be two or more special events with a small % of success that could change the historical outcome of the German nuclear project. First, that the German team gets help from e.g. Bohr. Second, if the German project gets under way at an early stage, that the Norwegian heavy water plant successfully produces the heavy water necessary to set up a German nuclear plant by 1942-43, or that the commando raids in 43-44 are unsuccessful so that a German plant is built in 43 or later. However, German success in conventional warfare, e.g. victory on the east front, could lead to a halt or closure of the German atomic project, unless there is war against the US.
I also think that alternative nuclear technologies should be included in HOI3, such as the Germans developing nuclear submarines.
As for the rockets flying nuclear weapons, it is very fictional to suggest the Germans would have developed nuclear rockets of similar strength of the American bombs dropped on Japan. However, as the above article suggests, and in line with someone posting in this thread suggested, it would have been more likely that the Germans had fitted the size of their nuclear weapons to the rockets they had at their disposal, e.g. a modified and somewhat improved version of a V2. This means that in HOI3 nuclear bombs must be developed in combination with either large bomber planes or rockets, where the former has much more significance than the latter in terms of destruction. However, would a series of V2-mini-nuclear attacks on London or Moscow have been as devastating as the larger nuclear attacks on Japanese cities? Maybe.
Dissent certainly would be affected by nuclear weapons. (Their horrific damage could be equal to if we today had been attacked by an unknown force out of our control to resist against, e.g. biological weapons of epidemic proportions dropped on major cities). Once their effect had become publicly known, e.g. by spreading pictures and publishing death tolls, both attacker and the attacked would most likely have been affected. Especially under suspicion that the enemy also could develop or already possess similar weapons of mass destruction. If one nation was repeatedly nuked or two nations nuked one another the dissent should reach such levels that the economies would be in chaos, soldiers may revolt or desert, and a coupe or public revolt (to try negotiating peace) would have a high risk of success.
Nukes in HOI3 could also be affected in peace time, e.g. that special events demanded the number of nuclear weapons to be reduced. In a post WW2 era with peace this could be the scenario. One thing I think is lacking in HOI is that war never really ends, with conditions such as those after WW1. Warfare continues for ever, but I think the AI, and dissent in human controlled nations, should increase slowly as years passes by. I know this is off topic, but after all civilians want peace and most of the soldiers in HOI are conscripts, not professionals. As such, the timing at which atomic weapons are used should also have an effect. A nation suffering from war for a long period may have a higher dissent penalty or suffer a higher risk of a revolt/coup, bringing the war to an end.