Sky Menace Early Game?

I just recently started playing SM, and I've read some strategy suggestions such as:

Spread out early (to get more units)
Use money to your advantage (spend as much as you can)

But just recently I started in South Korea, another player in Chine SE, and as I expanded to Tokyo, they took my capital and I lost quickly. How do I avoid this? Should I have striked his capital first?

It depends on the money available in the game.

SM is one of the most flexible and powerful strategies in the game, but at a very high cost to use.
If he started in china southeast I assume it must be at least 15k, and possibly 25k. In 25k China SE has the advantage because of all the units it can produce.

To avoid being rushed:
Remember that airtransports are your most important unit in SM, build them to send everything, including militia back to defend your capitol.
Always use aitransports and militia to help boost the rate of your expansion (SM has a very high speed of expansion but a very low rate of expansion if airtrans are not used)
Playing SM in general:
Use your mobility to the advantage to always have all of your units exactly where they need to be, every turn, which no other strategy can achieve.
When attacking, always immediatly reinforce with airtrans + units so that city can't be retaken if it's under threat.
Make walls in annoying places to delay the opponent, while always breaking all his walls so he doesn't know where you are going to strike, and therefore the enemy is often forced to spread out his units.

Well he had far more starting reins than you for one thing, and while japan is a great source of income, it requires a little more muscle to take because of the infantry cities so takes more troops, unless youre of a higher skill level than the china player youre unlikely to beat him/her with south korea.

My main advice would be to pick a better country. however you also could also attempt to expand heavy into some of the cities you think the china player will try to expand into. if you succeed you get the city in the reins, he loses his troops for nothing, its risky though.

Thanks guys.