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Alternate history is fun.

Here's a better alternate history: Hitler takes power in Reichstag Fire and suppresses the Communists, just as happened historically.

He rearms the country and launches his massive construction projects and thereby gets people back to work. This is really Keynsian economics, and it worked in America too.

He remilitarizes the Rhineland, thereby repudiating the Versailles Treaty, and stokes the flames of German nationalism.

In 1938 he completes the Anschluss and adds German Austria and the Sudetenland to Germany. And then he hunkers down on top of a roaring German economic powerhouse, develops his military, but he avoids the error of Poland.

So, Germany consolidates its central European empire, and its alliances with Mussolini and Franco, and Peron and other dictators in the Western Hemisphere, but does not go over the tripwire into war in 1939.

THEN WHAT?

Well, one thing's for sure: France and Britain were not going to gratuitously attack him.

There were indeed Communists, but Hitler and the Nazi, like Mussolini and Franco, were ruthless Communist hunters.
After the Reichstag fire and Anschluss, German pride (under Nazi nationalist ideals) was stoked and the Germans were working again. The future looked pretty good. The Communists flat out lost in Spain, and they would not have been successful in Germany.

But had Hitler kept his powder dry, there would have been no invasion of Poland, and peace would have been maintained with the West...which desperately wanted it.
Chamberlain's "Peace in our time" would have actually been correct.

Germany would have gotten stronger and stronger, and would have come to economically dominate the whole of Europe.

Now, in the absense of the general war, Germany would have still be tied to the world and open to trade. The Nazis would have abused the Jews, but the "Final Solution" orders of a desperate regime buried in wartime secrecy and possessing the enslaved Jews of Eastern Europe would not have been issued. A peacetime Germany could be really nasty to Jews, just like contemporary America of that time was nasty and horrible to blacks, segregating them, etc. But outright mass-murder? That required a war.

Hitler would have positioned his Germany as the anti-Communist bulwark, and there were plenty all over the West, including in the US, who saw him as that. Once he was ripping through Poland and Paris, of course, that was all thrown aside. But he didn't HAVE to invade Poland. Germany was getting stronger and coming back together under his rule. He CHOSE to start the war when he did.

Had he not obliged with a war, Western Europe would have been progressively economically and politically eclipsed by the Third Reich, but it would not perforce have faced war. Germany didn't have any particular territorial ambitions in the West. France had to be knocked out, because France was the primordial Western military foe, but Germany didn't annex France into the Third Reich. Hitler wanted a subdued France and a cooperative England. He invaded Poland and got a war, but he didn't have to invade Poland.

Now, history would have marched on, and Stalin was a despot.
Would Stalin have been able to resist the temptation to invade the Baltic States on his own? Or Finland, in the winter of 1939. Remember: when the USSR invaded Finland, the sympathy war in the West was very intense. Britain wanted to send troops.
Imagine no World War going on, with Germany as a growing anti-Communist military power NOT at war with France and Britain, when the Russians invaded Finland or the Baltic States.

Would Stalin have even dared attempt to take either Finland or the Baltic States in the face of France, Britain AND Germany?
Probably not.

I guess my point is that I don't think Germans would have been screwed had Hitler not pressed the war button. Yes, they would have had the Nazi Party running the show, but the pre-Final Solution Nazi Party was not noticeably worse than Franco's regime, which became an ally of the USA, or Mussolini's. Germany was powerful and efficient, and the German war machine was dangerous, but it didn't HAVE to set the West on fire. There was no timetable ticking that Hitler had to hold onto.

Had Hitler held his fire and built up Germany further and further and further, the West would have had the peace it craved. France feared war, but grimly accepted it. Britain didn't want war at all. The USA wasn't interested.

Stalin and the USSR would have been in the most isolated position, because the Westerners would not have been at war with each other.

Other alternate histories are difficult to really accept, because they require all sorts of different parties to behave differently. However, Germany not invading Poland is not unimaginable. That depended solely on a different calculation in the mind of Adolph Hitler. Dictators can indeed make such calculations. Franco did. Franco was every inch the dictator, and his Falangists were every inch the Fascists, but Franco chose to remain aloof from the pleas for alliance from the Nazis and Fascists who had help him win the Spanish Civil War. Spain desired war with Communists, but certainly not with the West, and so Franco stayed neutral, and eventually became an ally of the US.

Hitler didn't have to invade Poland and unleash World War II. It was optional with him. There was nothing inexorably driving him the way his decisions drove everyone else's in that war. German politics did not require him to launch that war in order to hold power. He held Germany in a hypnotic spell, and hadn't committed any irreversible atrocities yet.

And had he decided differently, the Germans wouldn't have been screwed at all. They would have been victors in the historical game against Communism, probably.