Well I realize I never really gave any advice for challenge 2 because it didn't feel right to do so, but in the challenge 2 advice thread, second post, which I made a while ago, I did sort of give some advice for challenge 1. I will let you guys decide how useful it is. I'm re-pasting it because I realize if people are looking in the challenge 2 thread there's a decent chance it's no longer useful as they've already beaten challenge 1. I will copy it and paste it below:

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My strategy for the first one:
Don't start in Central America, surrender. Meet opposition early on, surrender. Aren't somewhat stable by turn 15, surrender. One of the two teams is obviously getting dominated and you can't handle the other by yourself, surrender. Surrounded by enemies and have less than 15 income on turn 20, surrender.

Avoid getting into unnecessary fights and stay out of the way of the weaker team. Keep the opposing teams as balanced as possible, build up defense, and expand into the stronger team.

There's so much luck involved it's silly (and annoying). Makes it less about beating it in any given attempt and more about beating it in the shortest amount of time. Which probably requires you to surrender, a lot.
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Guderian: It seems like you're really close to beating Challenge 2. I don't want to tell you exactly each and every step I've taken to beating it, since I think the accomplishment of beating Challenge 2 is much more valid if there isn't a "Strategy Guide" for it. I'd prefer to just give more general all around advice.

Keep experimenting and trying out new strategies. I've beaten it a few times in my attempt to get the lowest turn number for it and none played out the same way. The AI doesn't always play out the same way, and sometimes you see different AI coming through different choke points. I don't really have a set strategy (outside of early expanding, but even that is variable based on factors like luck) at any rate.

"Guderian: It seems like you're really close to beating Challenge 2."

Thanks, I finally got it! It was so rewarding to hear that "AI eliminated" sound:)

aww man I felt I was so close to beating challenge 1. I had Africa, Antartica, Australia, South America and was pushing into North America. But I got bogged down in North America and then suddenly 100+ armies were being transfered to the Indonesian border and I couldn't hold.

I feel the problem I ran into was that one team was completely eliminated and I was stuck with 3v1 when they had the entire map. I had huge defenses in Australia/Indonesia for most of the game, but didn't want to expand too much. But now that I look back at the game, maybe I should have so I don't have to deal with such a large force once the game gets smaller.

What do you guys feel about the defense/expand question. When do you like to expand compared to defend?

Btw I know a lot of people like Africa to start with, but I started in Australia and I liked it. Easy expansion into Antarctica and Africa. The fact that nobody was south of Africa probably helped though.

Africa's fine, but my best results (20 and 27 turns) have started in Asia. It's hugely luck dependent though, on the 20 turn win I only had to deal with 1 AI while I took all of Asia. After that I was too strong and they were toast. Very rare though, I've tried again and gotten gang banged by multiple AIs in Asia. It's always a question in the game when you get strong enough whether to pick on one AI team or not. If you weaken a whole team too much too fast the other team might be too strong for you.

But keep trying, a lot of it is luck, you'll find the right game sooner or later:)