On the bright side, Hube army is not only a shadow of his former self but is now contained and the hope of being relieved or evacuated are extremely slim, basically if some miracale don't happen they will be forced to surrender due to the lack of...everything (frankly knowing the state of the territory at the time i doubt that they can rob enough to sustain themself for long)."Where we are, there is victory"
Operation Alaric had ended in bloody failure with much of its force either dead or stranded. The Fascist Freedom Corps had only managed to restore Fascism to a few square kilometres of Italian mountainside. It was a victim of limited or non-existant logistics, hurried timescales and the emotive, panicked reasoning which underpinned it. Comando Supremo in Rome was far from optimistic, their remaining armies had been further damaged and the promise of Allied rescue remained vague, however the Germans had been checked and some dared to hope that Hitler might cut his losses and realise the Alps could be used as an effective defensive line either way.
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The daring attack on Rome has been a failure that had cost Germany an elite division and the 4th army had been partially succesfull in retreat back in Italy and forming a defensive line in the alps (OTL around 60.000 italian soldiers were taken prisoner in France in a couple of days) while the Werchmatch not only need to pacify the territory but she will be very busy in re enacting the sumer 1940 battle of the Alps, taking the role of the italians in term of loss and succes (not only the terrain heavily favor the defender but it also full of fortification...and you need the proper equipment to survive otherwise you get a massive numbers of case of hypotermia like the italians in 1940).
There are still Sardinia and Corsica but i doubt that the Germans had been more succesfull there, even because they know that even in case of victory they are pretty much isolated and with the italian fleet near by there isn't a lot to spare for their evacuation IMVHO they plan will be a fighting retreat to the various port, taking all the available ships and use it to reach mainland France i don't take in consideration an airlift as the remaining capacity had been used to give some supply to Hube forces.
All that had bought precious time to the current government to stabilize and organize a better defense while continuing the negotiation with the allies and surving the initial onslaught will have given them a little more credibility and by now there will be probably a very hot discussion regarding what to do as the occasion is too big to vaste and every general with two functioning braincell will tell the politicians that they need to decide quickly as the Germans will try again and the italians can't resist that much
And now my personal two cents regarding the events:
As said before, it's an enormous change for Italy as the OTL event of 8 semptember still are felt here 80 years later, it was the collapse of a system, of the state and all the institutions; the entire italian population felt betrayed by his own government, with the armed forces melting and offer no meaningfull resistance against the germans while the King and courts run cowardly from Rome leaving everyone behind to fend for themself. It was a moment that permanently scarred and humiliated the italian psyche and national character, much more than Caporetto (where in the end we have First Piave aka the big 'you shall not pass' moment of the italian army done in a moment when even the high command though all was lost and the entire political system united to remain in the fight).
OTL the italian surrender meant hundreds of thousands of italians both military and civilians captured without almost a fight and sent to Germany as slave labor (with harsh treatment and precarious living condition) and many never returned; plus it started what by many is considered a civil war between the RSI (Republica di Salò) and the Co belligerant Kingdom of the South and again the scars and consequences have been felt for decades
ITTL with the legitimate government not collapsing and keeping (for now) control of the national territory, well the Fascist Freedom corps member can much more easily depicted as traitor and with Benny still in prison (with a lot of fascist hardliner i presume) there is nobody that can become a rallying point for the fascist
(As a note i presume that the remaining MSVN will be separated and positioned in various place where they can coordinate with anyone and be easily controlled)
This bring a very different italian society postwar, not even considering the much more probable survival of the monarchy; basically our WW2 legacy will be a lot less problematic and not forced for 40 years to be treated as a tragic comedy when is not fully ignored
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