I like the direction this is headed and I like the era and alternate history that you've cooked up. Those stub biplane wings are pretty awesome and the thing looks like it's got a huge engine.
Though it's fantasy, and I can certainly appreciate that(!), one suggestion I would make to get around the real-world flight physics issue and make it feel a little more like an experimental real-world plane from the period would to be turning the flat nose into one big air scoop for the engine and mounting the prop on the tail to make a pusher. Or perhaps use that idea for the German designs?
Of course, it's your world, so ultimately the level of speculation and artistic-license is up to you and I'll certainly enjoy watching it develop.
