Industrialization Level
Industrialization determines the ability of a nation of build complex machinery (tanks, heavy artillery, RR artillery, aircraft, and naval units except Torpedo Boat)
Tier 1 - Germany
Tier 2 - Britain
Tier 3 - France
Tier 4 - Italy, A-H
Tier 5 - Russia, Ottoman Empire
Tier 6 - Minor Nations (unable to build mechanized units, heavy artillery, RR artillery)
Mobilization After Start of War
Mobilization determines the ability of a country to produce Infantry units.
Tier 1 - Britain (large empire to draw units from)
Tier 2 - Ottoman Empire (had not mobilized before joining the war in October)
Tier 3 - all other nations
Railway Links
The density of rail network varied widely between the nations in WWI and had huge impact on the ability of nations to bring newly trained troops to the front.
Tier 1 - Germany (extremely developed rail network; virtually every tile)
Tier 2 - Britain (strong railway connection on the British Isles)
Tier 3 - France, Italy (all cities connected by rail)
Tier 4 - A-H (rail from Vienna to Budapest and Prague)
Tier 5 - Russia (only rail link from Petrograd to Moscow and further East to Siberia); Ottoman Empire (only link between Istanbul and Ankara)
Tier 6 - all other nations (no railways)
Technology
It is difficult to balance out technology until careful play-testing but it is clear that technology costs are currently too low. Increase all tech costs 10 fold (750 beakers instead of 75). 3-5 turns/tech for major powers and 15-20 for minors is reasonable to start with given that the war is 200 turns and there are a lot of techs.
Diplomatic Picture
The war should start with Britain/France/Russia/Belgium/Serbia vs. Germany/A-H. Since other nations come into the war, it is most simple to have all Allies in a perm alliance with each other and same with Axis. I realize this is not fully historically accurate. Italy declare war on A-H much before Germany and US on Germany before A-H and never on Ottomans but it really doesn't make much of a difference. Italy fought mostly with A-H and US mostly with Germany regardless.
War/Peace status should be locked and neutral nations should be unable to declare war or be declared upon although they should be able to sign OB agreements, trade resources and techs etc.
Events
Once again a list of events:
United States
I have 2 ideas how to handle US in the war since they are not included on the map. I think the best option would be to spawn US land/air units in France every few turns. To avoid them losing the game if they capture and then lose a city, give them an unreachable city somewhere on the map surrounded by peaks.
Russian Revolution
Starting from 1917, Russia could experience city revolts, spawning of barbarian units (revolutionaries), loss of production etc that cripple the country's war effort. In March 1918 it should make peace with Axis (Treaty of Brest-Litovsk) and cede vast territories to Imperial Germany.
Victory Conditions
Either a score victory (for each alliances) or conquest (takes too long). Domination, Culture, Space etc should be disabled. Anyways this is the last thing to be figured out.