Mmmm this interesting discussion. First of all, Hetalia deals with a very broad range of history not just WWII (although that is where most of the early strips came from). And it IS loosely based off of actual events; the manga-ka almost always posts a footnote explaining what event or time period he is referencing. There are obviously some very glaring things that Hetalia doesn't go over; rape of Nanking, Holocaust, bombing of Pearl Harbor or the dropping the the atomic bombs are some that spring to mind off hand. But I don't think that it's because Japan has an issue to dealing with it's own sketchy history, but the simple fact is that Hetalia is a comedy and there is no way you can make any of that funny.
With that in mind, I think Hetalia has a legitimate place as a series. Dealing with something through laughter, even horrible events like war, is nothing new in our time. From Eddy Izzard to South Park make a business in poking fun at things that really aren't funny at all, and Hetalia is much kinder in poking fun than the previously mentioned two. All the characters are stereo-types and none of them are spared looking foolish at some point or another. Sometimes real history is better than anything you can make up and different cultures have their own quirks, but we're a lot a like, too.
Now for me, the problems start happening with the fans start coming into play. You take any series/game/whatever with a verbose fandom and things can start getting a little out of control. For example, the actual series is not the yaoi-fest that the fans make it out to be; in fact, there is only ONE cannon out-right gay relationship and that is Sweden and Finland and it only lasts during the time period of when the Swedish Empire controlled Finland. I think that while Hetalia is a comedy, people should realize it's a HISTORICAL comedy and have a healthy level of respect for the actual events and people that were involved. The Anime Boston incident is a great example; a couple of mostly Purssia and Germany characters left the con location to go down a few blocks and were photographed doing a Nazi salute. While that is more than slightly off-putting to begin with, they ended up being ten blocks from a Holocaust memorial and the con was over Passover weekend. People were rightfully upset and there are now some general widely accepted rules about cosplaying form Hetalia because of the inherent implications those outfits entail (I'll leave that discussion to the cosplay section if anyone wants to talk about it).
Bottom line though, I'm a world hirstory and geo-political relations nerd so I think Hetalia is hysterical. England and France not being able to go two minutes without getting into a fight? Oh yeah, definitely Europe during the eighteenth century. There are hundreds of little nuggets of comedy for people who like history in there. You just... Might be the kind of fan who stays away from the gatherings and fandom, like I do.
Or it's just not your cup of tea in general. *shrug*
