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Good point, I only ever play HFM so I forgot that's a problem.
Under the rules of a vanilla game, the danger is that your position and your Empire's position gets so high that the Dominions often will reach great power status, rendering the whole project moot. Often times you'll find that Italy, Japan, Russia, France will one time or another fall out of GP status. Canada and Australia usually have a chance to break out from your control as a result. Your effort would be wasted instead.
You could move towards breaking up the US into its constituent parts. But that takes away from valuable infamy points that could used towards colonial conquest. You could alternatively just annex territories from the GP Canada or Australia, but then you land back in square one and now with angry nationalist pops.
Under HFM or HPM, I would completely agree with releasing the Dominions. Especially since subject countries take a massive prestige debuff that means that the European and Asian states can maintain GP status.
It absolutely impoverishes Canada compared to the US, which gets loads of immigrants because it's counts as a New World nation in game.
It's far better to release the dominions ASAP so they get all those immigrants that would otherwise go to the US, and then just keep them in your sphere and build factories for them. It contributes much more to your industrial score if the dominions are rich and populous because they'll be a reliable market for your own factories, and foreign investment is still counted to your own industrial score.
Making them states makes you king forever, but only ever king of a under-populated wasteland.
(cont.)
However, I'm afraid the supposed giant that was to be this Imperial Federation has not awaken as of yet. There is simply not enough people in Canada, and specially in Australia and New Zealand. On the other side, Great Britain is full to the brim with people, and so industry in the home isles is marching well. I suspect that the early conversion to states have rendered Down Under and Canada without any colonial migration bonuses. Apart from Ottawa, Quebec and the Caribbean Islands, population in most of the provinces outside of Great Britain is well under 100k. Healthcare reforms were enacted decades ago, but the population is not growing fast enough.
The game has been until now very interesting, and I am now immersing myself more into european affairs, trying to mantain the NGF down and Austria and France still going, while trying to balcanize the Ottomans as much as possible.
If you have some spare time, you should really expand the guide, it would be splendid!
Thank you for your response! I have continued the game, and I'm already in the naughty nineties. The spamming technique actually allowed me to convert the white dominions (Canada, Australia, New Zealand and most of South Africa) into states around the 1870s, and I did manage to colonise most of Africa. I think I have more than enough colonies and sphered countries, and I actually left some for the frenchies to grab to balance the european powers, and to still pretend to mantain some Gladstonian restraint on imperialism.
If you are following my strategy, you might realize spamming out ironclads and commerce raiders might not provide enough for your attempts. When you can, build cruisers. Its an expensive process, but it is completely worthwhile. Battleships are too expensive per unit when you need money for other things.
I would also suggest stealing more colonial land from the Dutch to gain extra naval bases (and money). Your dominion provinces will actually be quite useful still, since in the later game the Liberal and Labour governments force Britain to utilize more state control over the economy. If you're getting militant-socialist PTSD rebellions by forcing your government to go Radical, the extra states will grant you more colonial factories.
Best of luck!
P.S. I highly recommend upgrading the navy when you can. Less ships per unit of naval capacity, but more colonial points.
Any advice?