As far as I can see the main concern is the maximum size of the map, which would have an effect on long-range loyalty - that effect being that no range in-game would be long enough to cause a serious enough effect, even though there are negative effects caused by the distance of a city from the capital of that faction.

Even using the maximum dimensions you would still need to radically simplify the map, perhaps too far for your aims to remain the same. I'm all for such an idea, which would be a HUGE project, but I think perhaps the hard-coded limits will get you in the end. Also, it must be considered that the map is not a sphere, so the Japanese would have to get to America, and vice-versa, not through the pacific but via the Indian and Atlantic Oceans.