Pipz, the .205 we have in the game, is the .205V Veltro. It was designed a simple upgrade of the .202, and, originally (Series I) it has the same armament of the .202 (in fact, you can choose 2 7.7 mm in hangar, if you want). Soon it was decided to upgrade the armament and the fastest and easiest way was to replace the 2 wing MGs with 2 20mm cannons (on the Series III). As Krusty stated, it was just a matter of providing the Regia Aeronautica with a quick upgrade for the Folgore, without having to spend too much time on the design table.
In fact, the real .205 was the C.205N Orione (Orion) a partial re design of the Veltro, with an increased wing surface and a new armament, to be compliant with the specifics Regia Aeronautica had issued for a new fighter plane. 2 prototypes were built, 1 with 1 MG151/20 and 4 12.7 Safat MGs, 1 with 3 MG151/20 and 2 Safat and 1 of the cannons, in this configuration, was mounted in the hub. They were put on trials with the G.55 and the Re.2005, and, at the end of the them, it was decided to put into mass production the G.55 and the Re.2005 (in lesser numbers.. the Germans insisted that the RA should standardize its fighter line with the G.55), while the Macchi would have had to continue with the C.205V production to provide the RA with a front line fighter, waiting for the Fiat and Reggiane production lines to supply enough new planes for the fighter squadrons.