Came across a pretty recent reddit thread about OP asking what people would think of a Battlefield type game based on the current on going Ukraine-Russia war: https://www.reddit.com/r/gamedev/comments/x213rl/a_battlefield_like_game_on_the_ongoing_russian/
People in the comments were basically saying its tasteless and criticizing him for even suggesting such a thing, to imagine the struggles and torture of the Ukrainian people. Though we saw many such games based on conflicts that may have been going on at the time in other parts of the world. Usually to get passed the controversy, developers will often make up fictional states and characters, though with very obvious resemblance to their real world counterparts.
In 2010 Medal of Honor was one of the games that chose to depict real world events without changing to fictional settings, it depicted the western occupation of Afghanistan while it was happening at the time, and it did receive significant controversy. Why? No not because of the struggles and torture the Afghan people were going through, but because players would be allowed to play as the Taliban in multiplayer and kill NATO/western soldiers, the devs were bashed by many politicians and military for allowing such a thing, so much so that they ended up changing "Taliban" to "OpFor" (Opposing Force) just like they do in other games like COD.
We know that even video games are used as a tool for propaganda, but its often something we overlook, and don't notice, maybe because we still see games as something for kids and that (((they))) haven't noticed can be used yet?
But lets look at COD4 that came out more than a decade ago, during the height of the Iraq war. Basically starts off when a fictional country in the middle east undergoes a coup, and the Saddam type character takes over and assassinates the old leader. So the US decides to invade, they don't exactly say why, I guess they're the world police. You play as a US Marine thats trying to find and capture this character, which mirrors the hunt for Saddam after the fall of Baghdad.
Eventually a nuke is detonated which kills all the US forces along with everyone else. Remember this was 2007, the war has been going on for 3/4 years now, there is civil war and insurgency after the US overthrew the Iraqi government, the US fails in setting up this puppet democracy, and all the while the US military is still looking for these supposed WMDs (nukes) that the US government promised Iraq had (they never found any).
So lets recap how this game reinforced these propaganda ideas. They show this Saddam character who illegitimately came to power and is an oppressive dictator, they show his men executing innocent civilians, and then he gives this fiery speech where he condemns the west. So this is telling the majority western audience playing this game, that this guy is and evil dictator that hates YOU. And then it shows the US trying to save these people, when they get nuked, this is telling the audience that saddam definitely had nukes. And this character got his nukes from this terrorist type character, again telling the audience that saddam had links to terrorists.