It loosely follows the RotTK books, which I guess are loosely based on historical china, but not quite. Otherwise some of the characters would have 1 stage scenarios, Pang Tong for instance.
I'd take Historical > Gundam any day, mostly 'cause I'm used to it all. Now if they make a DW 7, which is likely, I think it'd be best for them to make it be a combination of 5 and 6, but definately bring back the system of the player being the commander if they choose them, that's my main problem with 6 and it makes the later levels a pain :|
But anyway, randomly started F.E.A.R again and even more randomly FFX-2, still haven't beat FFX yet :O