In an alternate WWII, Admiral Isoruko Yamamoto survives the American attempt on his life, and guides the Japanese Empire towards the course of surrender after America retakes the Phillipines and begins landing troops in China. As a leader in the peace process, Yamamoto agrees to the cession of all Japanese gains outside of South Sakhalin, and the creation of a new "Empire of Korea" under joint US and Kuomintang control to keep out the Soviets. Peace in Asia is achieved in 1944 instead of 1945. As a result, the first Atomic bombs are never dropped on Japan. However, the Soviets still learn of the Bomb's nature and begin building one of their own.
Meanwhile, the People's Liberation Army pushes the Kuomintang completely out of Northern China and down into the province Guangdong, but U.S. troops, as a result of not having to fight the Japanese for as long (and thus are less tired), manage to hold the PRC's hand. Eventually, they drop the first-ever atomic bomb on the PRC's new capital, Beijing, in early 1949. The Soviets, who in our timeline did not complete an Atomic Bomb until August 1949, are shocked. In the chaos, American and Kuomintang troops drive north to the Yangtze river before being stopped by a Soviet-supported PRC. Meanwhile, the west of China breaks away into many separate Warlords and East Turkestan. Meanwhile, the PRC shifts their capital to the industrial city of Taiyuan in Shanxi.
The Soviets and Americans broke off diplomatic negotiations after the dropping of the first Atomic Bomb on Beijing. The Soviets become paranoid, and Stalin threatens to bomb America into rubble should any more Atomic Bombs be dropped (by this point, the Soviets had developed their first Nuclear bombs). The 50s until Stalin's death become the most tense years the world has ever experienced, instead of in the 60s under Khruschev. The world waits in terror for the final, world-ending war to begin.
And the world probably would have ended, if Stalin hadn't died in 1953 of a heart attack. Though Khruschev is an unreasonable man occasionally, he manages to repair some of the relations between the United States and the Soviet Union. Back to China--the PRC occupies all of China North of the Yangtze, including Tibet and East Turkestan, while the Kuomintang, heavily influenced by the US, establishes their dictatorship in Southern China proper. Korea becomes a political battleground for the two nations. At this point, the Empire of Korea is
de facto as U.S. protectorate, but both the PRC and the Kuomintang claim it. The two Chinas to the world become known as China-Taiyuan and China-Nanjing. As a result of U.S. Aid and economic reforms China-Nanjing becomes highly prosperous, while China-Taiyuan becomes a highly-nationalistic impoverished nation, much like the North Korea of today.
As part of the easing of relations with the United States, the Soviet Union advises China-Taiyuan to cooperate with China-Nanjing and the Empire of Korea to create the Seoul Conference, held in the Korean capital every year to bring a reconciliation between the three important East Asian nations. The two most important goals of the Conference is to bring about a reconcilliation, or at least an agreement between both Chinas, and an agreement between all parties of the status of Korea. Though only three nations participate, it becomes a back-channel for the US and the Soviets to communicate with each other in tense times, and the US, USSR, and Japan are observing Members.
Eventually, China-Nanjing and China-Taiyuan agree to an independent Korea in the 1970s during the
detente, but even after the Cold War ends the Conference continues to be had. The border between both Chinas becomes the most heavily-guarded in the world, with all bridges over the Yangtze destroyed save one, for diplomatic negotiations. The long table inside the negotiations room becomes famous for the "Red Line" drawn across it to represent the border between the two countries. The Seoul Conference remains an important part of peace in mainland East Asia to this day.
The Flag: the flag is fairly straightforward--it contains in the center a tricolored Taeguk, a symbol of Korea, that represents Heaven, Earth, and Humanity. Each color and symbol represents a specific nation--the Yellow and Plum Blossom represent the Empire of Korea; the blue and White Sun represent China-Nanjing, and the Red and Yellow Star represent China-Taiyuan. The three stripes on the hoist represent the same countries. White symbolizes peace.
Flag of the Seoul Conference