Germany would have been defeated in less than one month, the german people would have revolted against Hitler and WW2 would never have happened.

But helas - that was just an early masterpiece of appeasement.

It is remarkable how easily things got out of hand... it's almost as if a spell had been cast.
But I think some of the apparent lassitude on the part of other govenments was based on an ill-placed hope that Germany would revolt... they didn't fully understand what was going on there.
As for the rest of it, many of the nations involved remembered WWI all too well, and were very reluctant to throw the gauntlet down again.
But I agree- every time I read an account of Hitler's remarkable early progress, I think I'd have made the call to get in there right away. Probably would have been bloody, but brief. With Hitler out of the game, Italy would have folded, Russia would have probably not grabbed as much territory as it did, and had Japan still made its play, it would have been far less difficult to defeat them.

Candle_86 - you make valid points.  I believe, however, that the Stalin government would not have openly declared war, but rather would have fomented and aided in-country Bolshevists as they had been doing in Germany (pre-1933) and in Spain.

The fascists in Germany *could* have been stopped, and confidence in the shaken, but given the conditions, another possibility could be that the Allies, given that they had to stop German expansionism "again"  could have imposed even stronger sanctions, giving rise to either a resurgent nationalism under someone other than the nazis, and/or a Bolshevist type revolution against the fascists that "once again"  led to German " humiliation"

Japan was already on an expansionist program, and I believe that their push would have eventually collided with the Western presence (Indo-China, Phillipines, China).  With no major war in Europe pushing an arms race, it's conceivable that the Western Powers (GB/.France/USA) could have been even less prepared than they were in 1941.  (Considering that war production had been ramping up, and that the weapons the ultimately won the war were already in development by late 1941).

IF a settlement had not been reached with the Japanese, I think that eventually the US led industrial might would have gained a much more costly victory.  However, there could also have been the possibility of a settlement with Japan, giving Japan control over what they already had in China and some of the Southeast Asian colonies/nations.