Alternate Reality with Nazis and Gnostic Demiurge

Question

I've been looking for a book that I read years ago in the mid '90s, but without success. The story started in current-day rural America. Within the first couple of chapters, something happens and the town (or most of it) is suddenly transported into the middle of a forest (IIRC, it was a perfect circle, as if it had been inside a bubble during the transition).

In this new alternate-now, the Nazis had won WWII and the US had not dropped the bombs on Hiroshima and Nagasaki. The Nazis glean (from an article comparing the Manhattan Project and Germany's Uranverein found in an encyclopaedia at the school library) enough information to build a nuclear bomb and use the town as a test site to get rid of the evidence of the town's existence, killing two birds with one stone.

Throughout the entire story, there are bits about Gnostic philosophy and the Demiurge, which seem to be somehow responsible for the town ending up in a different reality.

Answer 1

This may be Mysterium by Robert Charles Wilson

Awakening in a strange world of repression, rationing, and fear, the citizens of small Michigan town Two Rivers, victims of a mysterious government plot, band together in a dangerous quest to discover what has gone wrong.

This review provides a bit more detail:

An odd radioactive artifact had been found in an archaeological site and taken to a remote area in Michigan, near the small town named Two Rivers, for further research. One night, there was a highly intense flare and the next day, the inhabitants have woken up in a different world, a parallel universe.

The story is focused mostly on the differences between the two societies, the alien one being a theocracy based on Gnosticism, as far as I understood, because I don’t have a lot of knowledge in this field.

As best I can tell from the reviews, the theocracy is not explicitly "Nazis", but it is an authoritarian government that is pursuing a "Final Solution".

Based on a quick glance through the first chapter on the copy available for checkout via the Internet Archive, it is indeed replaced by a perfect circle of forest.

And there were other mysteries: the sighting of curious lights, the interruption of phone service to and from Two Rivers long before the fire could have grown to threatening size, the fifteen civilian witnesses who claimed they had approached the town from the east or west and found the highway cut cleanly, as if by some enormous knife, and nothing on the other side but trees and wilderness. Power lines had been severed just as neatly, and it was the loose lines, some said, that were the real cause of the fire.

And indeed, the school libraries are raided by theocratic government, from which they find the secrets of the "nucleic bomb" that they suspect their enemies to already have, and their plan to rush a bomb into production for use against the godless Europeans. And yes, the bomb is tested on Two Rivers first.

"She means the town doesn't have much time," Dex said. "The Procters mean to destroy it. They have some kind of atom bomb out on the old Ojibway reserve. That's what we came to tell you. Howard, even if Stern is alive — there's no way to help him. All we can do is try to get out."

Found with a search for site:goodreads.com alternate universe nazi gnostic demiurge