Subscribed!
I've always thought that Mussolini fighting with the Allies is a great idea for a timeline. If you find yourself rooting for a fascist, you know this timeline is special.
That said, I have serious doubts that Italy is going to be able to stand up against Germany in this war. I mean, they were exhausted from the wars in Abyssinia and Spain, and in our timeline they performed remarkably badly against the French in comparison to the Germans. I think early on, an Italian invasion of Germany for example is completely out of question. The best the Italians can do at the moment is hold the line, especially considering that one of its military's more impressive assets, the navy, is not of much use against the Nazi land juggernaut. I think it is possible for this timeline to somewhat alleviate the program by introducing reforms into the Italian military that didn't happen in our timeline, such as increasing co-operation between the air force and the army, as well as a Lend-Lease program for the Italians to provide them with proper tanks and monoplanes
p), and supplies.
The ideological and political consequences of this timeline are also strangely pleasant. Now the Italians don't have to persecute Jews against their will, their intellectuals don't have to deal with an inferiority complex towards them irritating Nordics
p), now being able to embrace Mediterraneanism, and people like Farinacci are out of the picture.
I also don't doubt that Germany will still be defeated, despite having been largely released from having to commit troops to the Balkans due to Italian overconfidence. The post-war period must be fascinating. Will Italy be a bit like Francoist Spain, or completely different?
There are ample ways Italy helps out:
1. More Allied forces available
Knowing they don't have to keep forces on hand in case Italy gets ideas, the Anglo-French can deploy stuff that OTL was kept in the Mediterranean against the Germans - troops, aircraft, warships (useful for the Norway op) etc. Even if France still falls, there are bound to be butterflies, with e.g. Norway holding out longer or increased German casualties
2. Less German forces available
With millions of Italians right across the border, Hitler can't really afford to leave nothing there as OTL. Infantry, equipment, aircraft - all would be needed to deter an Italian offensive. The biggest potential butterfly is that the Austrian Mountain divisions, OTL crucial for Op. Weserubung, may not be readily available for deployment in Norway on such short notice, forcing the Germans to use bog-standard infantry instead (again, potential for a worse showing in Norway)
3. Italian forces available to fight the Germans
In the closing days of the Battle of France, German panzer spearheads reached the Swiss border, cutting off the French armies manning the Maginot Line - which arguably made the choice of surrendering or fighting on a whole lot easier. Put an Italian corps of two tank and a bunch of infantry divisions in their path, and the French will have ample time to disengage and re-form a line along the Rhone valley.
4. A much harder time for the LW
Due to the high tempo of operations, conducted over hostile territory and operating from makeshift runways, LW strength was down to only 2400 aircraft at one point. Unfortunately, the French blinked and transferred their modern fighters to Africa. Here, they can keep on fighting, and the balance in the air might just swing in favor of the Allies (by that time though, France was already lost, but this will have consequences later on)
5. Less chance of a French surrender
With Italy fighting alongside them, the French will have the readily available option of conducting a fighting retreat towards the Alps instead of the prospect of leaving all their equipment behind whilst they board ships bound for Africa.
6. A loop-sided Battle of the Atlantic
Italian destroyers and light cruisers can now be used for convoy defence. Italian shipping is available to the Allied cause. The Mediterranean is open to shipping, shaving off thousands of miles and thus saving up tonnage by the boatload
Also, with no Mediterranean theater siphoning Royal Navy warships, German surface raiders are well and truly screwed.
All in all, the Battle of the Atlantic is over before it even begins.
7. No (or much reduced) British freakout over a possible Sealion
With increased Kriegsmarine losses in Norway, a dragged-out campaign over France, generally more assets available overall, and with the ability to carry out imports at will and elements of the Italian and French navies on hand to be deployed to Britain, the probability that Britain makes OTLs mistakes due to fear of Sealion (e.g. continuing production of crappy AT guns) is not quite zero, but close.