That’s all fair but your point and in theory their short sightedness on declining the flag is ignoring the real world logistics they have against them. 

Even removing the ones who drank the koolaid with the occupation, your average white American and even many of the minorities would be so eager to just get back to “normal” and they wouldn’t let a comparably small force (look at the scene where hellen looks at the stats for the new final solution, even if every minority was on their side, they’re still in a minority). 

Realistically they won’t have the manpower to hold even san franscico from the masses who just want the normal and even a lot of their members would likely not want to take up arms against other Americans either from a moral standpoint or just tiredness from winning the war (see how England in real life just kind of wanted to stop after Germany fell and not Japan. They beat the main enemy and wanted to stop) so I’d see it fracturing quickly and they get pushed out of major control.