What is it about and why was it controversial?
Well see, it takes countries and personifies them into people. So for example, the person for "Canada" (his name's actually Mathew, but in the fandom you can just call them by their country) he's a really laid-back guy, always carries a grizzly bear around, looks kind of like the person for the USA (actual name; Alfred) because Canada and the USA are often confused by foreigners due to our similarities in culture and all that, and in the web-comic strip about Canada he often gets confused for the USA by the other countries and beaten up for it ;____; He is also often forgotten (one strip was of a G8 meeting and only 7 people/countries were there but no one could figure out who was missing. It was Canada, lol). America is burger-loving, France is very romantique~, Germany is strict and no-nonsense, etc., etc.
You can see pictures of the personified versions of the countries here.
So anyway, as you can imagine then, stereotyping countries and trying to write out historical and current relations between countries can lead to some controversy amongst those that are sensitive to the issue(s). Although the series centres around the axis powers of WWII everyone has their own country(ies) of interest in the fandom I'm sure. My personal interest is, predictably, the East Asian countries; China, Korea and Japan (and toss Taiwan, Hong Kong and Tibet in there too since they gave them personified characters too).
It's been really interesting following some of the stuff in the series, not even so much the "official" stuff but some of the fan-works. There's some country slashing going on (Russia/China, UK/USA, USA/Canada, etc., etc.). In the web-comic China is placed in a 'big brother' role with Korea and Japan being the younger brothers. One comic strip had China finding Japan when he was very young and raising him, but Japan kind of meandered away from what China taught him (instead of Chinese characters Japan wrote Hiragana, etc.). I thought that was really interesting, wonder if that rubbed any Japanese or Koreans the wrong way.
I've read some Russia/China slash...THAT was interesting. On one hand my mind was going "omg, KYAA~ Hot! Hot!!" and on the other I'm thinking "China and Russia as LOVERS??! What kind of twisted relationship would they have?? O__O". I've seen some doujinshis (fan comics) of UK/US...didn't weird me out AS much as Russia/China (UK and USA having smex...I think when I got to the smex part I kind of had to force the "country" side out of my head and just think "pretty boys having smex, pretty boys having smex, :D"). I've read a fanfic on UK/China with the setting being during the Opium War. THAT was a hard story to get through, surprisingly. Saw a few fanarts around China and Tibet (no smex involved, thank GOD), that's a bit of a sensitive spot for me after last year, so I think for my own sanity and the enjoyment of the fandom I'll just stay away from that for now. China and Taiwan's another interesting relationship that I've seen a few fan-creations depicting. I'm not AS reactionary on China and Taiwan as I am regarding China and Tibet, but it depends on how it's written/drawn (like for example, the comment on that linked fanart by PrimeMinister wanting ROC (Republic of China, aka. Taiwan) to rule over mainland as well as the island of Taiwan instead of PRC (Peoples Republic of China, aka. Mainland+HongKong+Macau) really irritates me). It's a good gage to see which issues I'm sensitive about.
Because the anime's so short and the webcomic's are just scribbled little strips there's really not much so far as far as official stuff is concerned, but some fans have created some amazing pieces. Like this music video around the relationship of the East Asian countries (the East Asian Family, hehe) to a song that is fittingly called "East Asia" (you get to see some fanart depicting the part where China finds Japan and raises him but then Japan grows up and kind of...uh...well turns on China...in the web comic China has a scar on his back that most fans agree is from Japan...ps. China also has a panda tattoo on his bottom, XDD. Korea's in there too of course, and Taiwan, she's the only girl in this family, and I believe you see Hong Kong too);
Or this music video made using fanart to depict some Russia/China slash (these two I see one of those love/hate relationships with a lot of breaking up and angry make-up smex....ugh god....I'm gonna get cursed by my ancestors for this x__X);
And even this cute music video depicting some UK/China (how they made that relationship cute is beyond me, when I think of those two countries of think of the 8-nations alliance invading China and 2 Opium Wars with China losing money and Hong Kong...but the video's cute);
Or this little UK/Japan music video (what's the relationship between UK and Japan?? As far as I know those two haven't come to any major blows in recent history have they?);
I really wish they'd make this into a full-length anime series instead of those 5-minute webcasts. Hell this is one way to get people interested in politics, and admittedly the most entertaining way I find. That hetalia community's full of beautiful fanarts, well-written fanfics alongside some political discussions and debates, three things you don't often see together. Man if any of my profs used this to teach one of his/her class that'd be so awesome~