As a note, it's almost inaccurate to talk about what Japan could have done had it chosen to limit the war in Asia to just the Second Sino-Japanese War, as its campaigns against the Western Allies were an effort to bring about a victory in Japan's war against China that the IJA had been unable to deliver on its own. I've written extensively about Japan's path to war with the United States, United Kingdom, and the other Western colonial powers here, and it's important to note that Japan's Southern Operation was a gamble to try and bring an end to the war in China. To that end, talking about what Japan could have done had it continued the war in China without expanding the war into the European colonial holdings is a bit misplaced, since a key reason why Japan sought to expand the war in the first place was due to its inability to win the war in China.

With that being said, by about 1939, Japan had reached its high water mark in China. Its campaigns throughout 1937 and 1938 had seen it take control of the most important economic areas in China, in the North China Plain and the Lower Yangtze--the latter of which had been the center of the Nationalist government's political and economic power. In its efforts to cut off China's access to global trade, the Japanese had occupied most of the ports of southern China.The Nationalists had been forced to retreat to the Sichuan Basin, and Japanese forces also controlled most of China's railway, yet this was already stretching Japan's logistics system to the breaking point. Japanese logistics were heavily dependent on rail transport, and once the railways had been taken, the Japanese found it very difficult to go beyond them. Moreover, the Japanese economy was already beginning to suffer the strain of supporting the seemingly endless war in China. Japanese advances had been checked at Changsha, and by 1940, the war in China was at a stalemate, with the Japanese unable to pursue the Nationalists further up the Yangtze into Sichuan, and the Nationalists unable to push the Japanese back. The war in China would remain at a standstill, with most Japanese forces focused on attempting to pacify and hold the areas of China it already controlled, rather than seizing more territory, until 1944, when the Japanese launched its famous Ichi-Go offensive, which saw the Japanese mass nearly their entire army in China for an attack south. While the Ichi-Go offensive did succeed in overrunning a significant portion of southern China, it also failed to knock the Nationalists out of the war, despite inflicting severe defeats on Nationalist armies. However, this withdrawal of forces from the rest of China opened much of Japanese occupied China to extensive expansion of Chinese Communist forces establishing base areas.

To give a bit of a short answer, by the time Japan expanded the war in Asia to include the United States and the other Western colonial powers, the Japanese had managed to take most of the areas of China they were realistically capable of taking. However, as I noted above, it's difficult to talk about what could have happened, since the Japanese decision to expand the war was in turn tied to Japan's inability to bring the war in China to a conclusion.