It's really hard to explain things in quotes, so let's do a (literal) timeline recapturing events thus far:
1864: The Confederacy is put on the defensive, with Grant's Overland campaign against Virginia (with Lee's army blocking his way) and Sherman's march on Atlanta. With the Anaconda Plan blocking the seas, the Union having captured control of the Mississippi, and the Union's adoption of total war, refugees flood into Richmond. POD: Food riots and a cholera scare cause the city to be locked down, allowing malefactors such as army deserter Shaun Regan to coalesce into something akin to organized crime, unionized labor, and counterculture among the refugees and starving city residents; turning their fear, desperation, and frustration against the perceived excess and incompetency of the Confederate government living within the same city as all these necessitous people.
When word of Sherman's razing on Atlanta in September reaches Richmond, the pot boils over. The majority of the impoverished mob move on the food stockpiles that they think (correctly or not) are being guarded to feed the central government come what may. However, this is used as a diversion by a force of rioters led by Shaun Regan and his fellow deserters and wounded-and-discharged veterans from the Confederate Army. With most of the nearby forces fending off Union forays near the city (meant to force Lee to give up more ground) or protecting what food stockpiles there are from the riot, the mob manage to storm the capitol building and the Confederate White House.
Jefferson Davis is taken alive, others are taken hostage or killed. However, government functionaries and others fleeing the city expand the tale into an utter massacre of the government and the city burning to the ground behind them as they ride away. Had word penetrated to individual Confederate commanders near the city, liberation of the government could have been achieved. In fact Regan's mob were expecting this, which is why they had taken hostages of prominent men rather than outright slaughtering them.
However, the first person in a position to make decisions about large troop movements to hear about is the man himself, Robert E. Lee. Suffering from heart problems, in poor health and spirits already, and hearing that the capital city of his beloved country (Virginia) and government of his adopted country (the Confederacy) are gone in a blaze of flame with no reasons he can possibly fathom (the idea of a white class struggle in the Confederacy boggles the 19th century mind) the great general retires to his tent, lies down, and dies.
Word spreads like wildfire and the Army of Northern Virginia essentially disintegrates, allowing Union general Sheridan to lead a forward recon-in-force which takes him all the way to Richmond before he realizes no one was there to stop him.
He enters the city, to find that the Confederate government has already been captured and a committee of sorts in charge and eager to negotiate the surrender of the city, and with it the state and the entire Confederacy itself.
By peacefully transferring command of the prisoners, including President Davis, to Sheridan, Regan guarantees that his 'unofficial requests' will be listened carefully; "unconditional surrender" policy or no. You have to keep in mind that Unionist guerrillas were common enough in the Confederacy, and anyone would have a hard time grasping the idea of this being an anarchist or socialist insurrection.
What this bodes for the Reconstruction is that, instead of Southern Republicans and negroes, the appointed government of Virginia will be Regan's "Red Army" of insurrectionists; a political clique that formed among dissidents and neer-do-wells ranging from the merely opportunistic like Regan to true political prisoners broken out in the Richmond Rising. One of these political prisoners will be made Governor and Regan will have his ear.
The example of Richmond and Virginia makes non-Radical Republicans and War Democrats eager to take credit for preventing a lengthy and expensive occupation of the South. Rather than punishing the South with Republican and Negro appointees, rehabilitation from the Confederate mindset is attempted by putting factions that were pro-Union (or in some cases simply anti-the-government-of-the-time) into power. Because many of these were state senators and important men from the traditionally less-slaveocratic/anti-secession Mountain South, this "puppet government" approach is called the Appalachian Plan.
Needless to say, having former "bushwhackers" and "traitors" in charge isn't actually any more palatable to the average Southerner than the reformist sensibilities of OTL's Reconstruction appointees.
And with Union soldiers still taking lead in keeping this governments in place, for most of the South things are much the same as the OTL Reconstruction.
But not in Virginia. The under-the-table compromise with the Red Army Faction (which is to say with the newly freed politician face Regan and his inner circle put on their mob) allows the appointed government of Virginia great control over it's Reconstruction.
So when they break up the plantations (not that many exist in Virginia) they give the land to the lower-class whites and they generally treat people of color like crap right alongside their former wealthy slave-owners.
These policies turn out to be very popular and replace the Democratic Redeemer meme of OTL. So when free elections are allowed in the South again, the southern Democrats are still barred from participating and Regan and Red Army Faction supported candidates throughout the former Confederacy are elected.
Of course this does not bode well for the stability of the reunified nation, as keeping the West white was one of the major motivations of the North in the war. In OTL once the Reconstruction ended basically it became clear the North didn't really care whether African-Americans got their plots of land in the South or became field workers again, as long as they stayed in the South. But ITTL, plantation culture is completely destroyed by the Reconstruction as the goons that would join the KKK in OTL and romanticize the plantation owners they used to despise become pseudo-socialist redshirts of the RAF, using the Northern mandated "Freedman Bureaus" to redistribute the plantations...among the lower-class whites.
Of course when blacks start streaming North and West, Lincoln and the Free Soilers are going to Re-Reconstruct the South and smack the RAF the same way Grant smacked the KKK, right?
Let's just say I'm opening up the next entry with an assassination and a certain pro-South VP becoming Pres, as well as the Radical Republicans splintering into Free Soiler and inclusionist (pro-integration) Socialist factions; dulling their influence. Plus the Inclusion Socialists and Northern versions of the racially exclusionist RAF-inspired Unions will be at each other's throats too; meaning Northern Democrats and Moderate Republicans will be the only ones not completely marginalized and radicalized.
And with the stage set, the disenchanted veterans of the Union Army, robbed of their victory and treated worst than OTL, will become a force unto themselves...