Because Italy was rich and urbanised and densely populated. There was also a large literate class. This makes it very hard to germanise it. Poland and Hungary were sparsely populated and mostly rural. This makes it easy to form new cities which are populated with germans and clear forest and fill the land with german peasants.
What Kalan said. Surely a centralized HRE becomes a bilingual German-Italian state, Germany and Italy would be too balanced demographically and economically within the HRE to prevail on each other, and Latin would rermain imperial lingua franca fro the Empire's ruling class up to modernity.
However, we may expect that at the very least Bohemia-Moravia becomes fully Germanized and Slovenia undergoes a mix of Germanization-Italianization, just like France was unified linguistically. A 700-years-long political unification surely means that the ruling and middle classes throughout the empire would be even much more deeply assimilated culturally, so the 19th century literary resurgence of Czech and Slovene would be butterflied out, they would remain peasant dialects and be gradually wiped out.
As it concerns eastward expansions of Germans into Poland and Hungary, and of Italians in the Balkans coast and the Mediterranean, it is reasonable to expect they would be more successful than OTL if backed by the one of the strongest states in Europe, even if the exact extent of the ethnic-cultural-linguistic borders is of course widely exposed to butterflies.
Anyway, it is quite possible and indeed likely that both Poland and Hungary-Croatia end up as vassals of the HRE, if not Habsburg-like personal unions.
A united Germany is frankly big enough. I cannot see a Germanized Hungary by then (as opposed to the OTL-hungary with a large german minority in cities and on the countryside). Albeit under Habsburg rule, Hungary is still a kingdom and would rise as in 1848.
Eastward expansion was very successful in the Middle Ages about Germanising the territory between Elbe and the Oder, and seeding Hungary with sizable German minorities. It is to be expected that with the backing of a strong centralised HRE, expansion in Hungary would be more successful than IOTL, even if I would expect that Poland would remain the preferential direction of expansion rather than Hungary. Maybe as it concerns Hungary, we may expect annexation to the HRE and full Germanization of Slovakia, which was an area of German settlement IOTL.
More so, we are in the time of nationalism on all sides. Prussia/Germany tried to Germanize the Polish population within its borders during the 19th century and met with little success.
Err, we are speaking about a 12th-13th century PoD here, centuries before nationalism. Ethnic-cultural identities were much more fluid back then.
Btw, what is the definition of "Western Poland" here???
I think that at the very least and/or in the early phase, we may expect Germanization of Greater Poland and Kuyavia, with the German-Polish ethnic-cultural-political border to be placed on the northern Vistula-Warta line. Additionally and/or Later, with the Germanization of Prussia and further spreading into Masovia and the Lodz region, we may also expect the German-Polish border to resemble the Prussian one after the Second or Third partition of Poland. Let's say the Niemen-Narew-Vistula-Pilica Line. TTL core Poland would essentially become Lesser Poland, and be forced to expand eastward, towards Galicia-Volhynia, if any.
It is also reasonable to expect full Italianization of Istria and Dalmatia. As it concerns the Italian half of the Empire, its most likely direction of expansion besides the Balkan coast would probably be "reconquest" of North Africa, as part of the Crusades, Algeria, Tunisia, and Libya.
By the way, with a strong HRE at the core of Europe, we may also expect that the late Crusades would be much more successful, so the Latin Empire, the Crusader states in Syria and Palestine, and Crusader conquest of Egypt could easily all be successful, at least temporarily. Of course, further developments are exposed to wide butterflies, the Latin Empire might easily be rejected by the Greek population and the Crusader states to be crushed by later Arab resurgence. OTOH, it is also possible that this could butterfly away the Arab/Islamic conquest of Anatolia, Greece, and the Balkans, and/or lead to the (partial) re-Christianization of Syria, Palestine, and Egypt (whose "native" Christian communities still were sizable in the Middle Ages, btw). Surely, even if butterflies smooth out the effects of more successful late Crusades, and the later history of the Middle East mostly plays out as IOTL, a strong centralized HRE would represent a powerful bulwark against Ottoman penetration in the Balkans.
As it concerns France, at the very least we may expect that French expansion in Alsace, Lorraine, Nice, Savoy, Corsica, and Franche-Comte would be stopped, whileas Artois, Flanders, Picardy, Champagne, Burgundy, Dauphine, and Provence could all become contested areas between France and HRE to some extent. Of course, the success of those contests, besides the usual abundant military and dynastic butterflies, would depend on the effects of HRE centralization on French nation-building as well. It is possible that it remains largely unaffected, but it is also possible that HRE interference combined with Angevin-English encroachment wrecks French unification, and switches the historical fates of France and Germany-italy. It is also possible, hwoever, that it prompts the success of Angevin and Plantagenet attempts to unify France and the British Isles in the same empire, which would give the HRE its worthy peer in Europe.
