If the Soviets allow the Commies to create a satellite in Manchuria then Chinese- Soviet relations would be very hostile. Not ideal for either of them, but very possible. For the Soviets it would be a question of pride, and the RoC was already pushed too much into America's lap for their taste. Chiang's days are counted though. He was useful as a symbol to keep Kuomintang alive OTL, TTL his independence would not go home well in Washington, so he'd probably be replaced by a more loyal general. China would probably be ruled by a Junta for quite some time. Of course there'd be no catastrophal Great Leap Backwards, but China would very much be a Police State. The Kuomintang would officially back a free market, but some nationalization of key industries would be allowed and tolerated by the West. To remedy loss in Chinese pride due to the loss of Manchuria, the West would look the other way when China invade Tibet. Only India and the USSR would be upset. In time the Junta (which btw would probably be quite corrupt) would have to give in to the demand of reforms. "Democracy" would be introduced, but the rules would be clear. Kuomintang wins every election, opposition candidates will be harassed and even arrested. Thus Kuomintang keep their iron grip on the country. Corruption would be an enormous problem.