Celtic Phoenix is Atlas' strongest Propagandist. The way he sanitizes and uplifts the nation compared to canon is disgusting for a so-called fix fic
While Cordovin has a lot of nationalist pride at Atlas, shes moreso an arrogant blowhard than an outright villain. She has Argus' best interests at heart and is able to eventually see reason. Her nationalism still causes problems though, as she pulls out the Colossus to make a statement about the might of Atlas. Which is completely uncalled for to fight the main cast since it's meant to fight grimm the size of skyscrapers, and her using the mech causes a panic among the people that creates a grimm invasion. She creates the mess, she works to clean it up and lets the heroes go
Cordovin's nationalism is so strong in FRWBY that she abandons Argus at the first sign of danger. She says that she has no obligation to protect Argus even thought it's her fucking job, and she gets restrained by Dee and Dudley after giving the villain speech. You would think that Cordovin's nationalism in FRWBY is going to set the stage for Atlas itself being a lot more villainous right? Nope. Cordo is treated as an outlier that doesn't represent Atlas accurately at all
If Cordovin was a man I'm sure she would have seen reason from Ruby's speech of protecting the people. Alas, she's a woman and FRWBY is a misogynistic piece of shit, so she doesn't get to redeem herself
In the Atlas arc the core conflict from the main cast vs Ironwood and the Atlas military is a difference of how to be heroes and save the world. The main cast are idealists trying to save everybody they can despite the odds or how dangerous the situation gets. Meanwhile Ironwood, and by extension Atlas itself, poses itself as the "realistic, pragmatic" approach abandoning the people you can't immediately save because it puts you at a strategic disadvantage. An utterly heartless way to do things because as Blake puts it "You're betraying the people you swore to protect."
In FRWBY this is entirely removed. Instead Ironwood turns on team RWBY because he thinks Ruby betrayed him, when it was Neo in disguise
In canon Atlas has a clear military culture that hurts the self-worth of its soldiers. The Ace-Ops claim that they're disposable unfeeling cogs in the machine that is the Atlas military, even though they clearly don't really feel that way. Clover is blindly loyal to Ironwood and makes rash calls that end in his death due to his desire to appease his superior officer. Winter outright tells Penny "My life doesn't matter!" when she saves her during their fight with Cinder, even though she's slated to be Ironwood's next maiden which means if anybody's life "matters" it would be her's
This is entirely removed in FRWBY. Penny, Ciel, Flynt, Neon, Winter, and Clover. None of them show any signs of this beyond Neon putting up with the racism she faces in Atlas, which only tangentially relates to this at best. On top of this according to Ironwood Atlas' culture of reducing individual expression is "greatly exaggerated" in FRWBY
On the subject of blind loyalty, Atlas' military culture fosters a mindset of thoughtlessly obeying your superiors no matter the situation. The Ace-Ops go from allies protecting Mantle to enemies of the main cast abandoning the poorer half of Atlas according to the whims of Ironwood. It takes almost an entire other volume for them to grow out of this once Ironwood's actions become too monstrous for even them to justify to themselves
In FRWBY this barely exists at all. Clover Flynt and Neon have this "just accept the arrest" attitude when RWBY gets an arrest warrant to see how things play out, but that's ALL
Then you have Jacques who in canon isn't meant to be redeemable in any way. But in FRWBY Celtic straight up makes him a better person than canon to make him "smarter, understand politics, not a greedy idiot." On top of the abuse of his family getting downplayed compared to canon, the election plotline and all that it entailed was cut. Meaning Jacques doesn't end up helping Salem's faction due to his own greed and selfish desire to hurt Ironwood
Then there's Ironwood who in canon is a major contributor to the Fall of Atlas. His paranoid tendencies hurt his reputation among the people, he turned Mantle into a police surveillance state before the main cast even arrived in Atlas, and him not telling anybody anything outside of his inner circle the truth of what he's doing is treated as a failure by the narrative. On top of this his admiration for Salem's perceived lack of humanity is the inspiration for why he takes increasingly monstrous actions once his paranoia starts spiraling at Volume 7's climax which leads to him abandoning Mantle to die
In FRWBY his paranoia has been reduced to the point of near nonexistence. He treats Mantle better than canon because it doesn't have a literal hole in its wall in FRWBY. He eventually tells the Atlas council the partial truth on his own with no prompting from anybody other than them. He doesn't turn Mantle into a police state until he decides to become dictator of Atlas about 2/3rds through V7. His admiration of Salem's lack of humanity was completely cut. He doesn't plan to abandon Mantle, at least not yet
Hell Cinder's backstory was changed to be in Mistral instead of Atlas now. Meaning if Midnight in V8 ends up anything like canon it's the Mistral elite that enslaved and tortured her instead of Atlas'. And I'm sure that if it does remain similar to canon, Madame will abuse Cinder just as badly if not worse than canon. Because unlike Jacques or Ironwood, she's a woman in FRWBY and she won't be from Atlas anymore, and FRWBY is a misogynist piece of shit that LOVES Atlas
The only thing that Celtic did that makes Atlas look worse than canon is that we're shown a fair bit more racism than canon, which I'm sure CRWBY would have done if they had the time money or manpower to include. Unfortunately unlike Celtic CRWBY has to deal with the restrictions of the real world instead of fanfic land's infinite budget, and they needed to prioritize on the story they needed to tell
Atlas is not portrayed in a very positive light, and that isn't a mistake in the narrative. Given how Atlas' values are antithetical to what RWBY as a series stands for, of course they wouldn't be portrayed very positively as a whole. That isn't to say there are no good Atlesians in canon, but a real spotlight is put on the flaws that a nation with a strong military culture and strong rich-poor divide would have. Celtic though scrubs away so many of these flaws away from Atlas and its people, and then has the gall to call it FIXING RWBY