The heart of this issue is the introduction of Bucky and Toro as young sidekicks for Captain America and Human Torch, as we enter Fall 1941 and the start of Winter.
Sub-Mariner was captured last issue after he hit New York with a tidal wave. He has been held prisoner by the US government since then.
In Germany Prof Schmitt was sent to a concentration camp as an inmate last issue. But he remembers the partial version of Prof Erskine's super-soldier formula that he had been studying in Project Nietzsche. He whips up a batch in the experimental wing of the camp, and gives it to a fellow prisoner. This is English Brian Falsworth, son of WWI hero Union Jack, who had been undercover in Germany as American Keen Marlow. Schmitt is killed by guards, but transformed Falsworth escapes and fights behind enemy lines as the Destroyer.
Project Nietzsche escapee John Steele is still following Red Skull. Last issue he saw him meet with Atlantean renegade Meranno. Now Skull is hobnobbing with a Japanese general. Steele finds plans for a combined attack on Washington D.C. and Hawaii. He leaves to try to get word to America.
Back in New York Human Torch now has young partner Thomas 'Toro' Raymond. They met last issue when Toro burst harmlessly into flame. Since then his parents have been killed in a train crash, and HT has adopted him and is training him to use his flame powers.
Meanwhile Captain America has teamed up with another orphan Bucky Barnes. 16-yr-old Bucky had been living on a military base (even after his soldier father died) and was always in trouble. The US government had channelled his energy and trained him to be a propaganda answer to the Hitler Youth. They now made him Cap's partner. The idea that the partnership arose because Bucky discovered Cap's secret identity is described as more propaganda. Now Cap takes Bucky out on his first mission.
Lt Sawyer has moved on from sending Nick Fury and friends after Project Nietzsche in earlier issues. He is now in charge of Cap and Bucky. He reminds Cap that they should expect to re-enact tonight's mission for the camera's tomorrow. I.e. that they are part of a continuing propaganda exercise.
Meanwhile Angel has been tracking the Nazi spy 'handler' who escaped from him and Cap in #5. The heroes converge as the handler welcomes ashore some Atlanteans led by Meranno, whom Project Nietzsche has transformed into U-Man. The handler and his men and most of the Atlanteans are killed by Bucky's machine gun and Angel's pistols. U-Man escapes, but one live Atlantean is left captive.
Angel is presumably wielding Two-Gun Kid's guns for the 1st time here, that he was given in #1. Maybe it's a reaction to getting shot in #5.
Meranno as U-Man first showed up in Invaders #3-4. This was obviously after the Invaders were formed, so Marvels Project is jumping the gun by presenting him here. I don't believe there has ever been any direct claim that U-Man was created using Erskine's formula. However the creation of Master Man in Giant-Size Invaders #1 used a version of the formula, so I would guess that was used on U-Man too, and their companion Warrior Woman.