well I'm not the big expert on this but I think admylin (and well this is what I did actually as you know) is consider where your dc's life is likely to be. Are they likely to finish their school education in Germany? Will they study/train here or will they be off like a rocket overseas when they're done with school?
I was 100% sure my dd would choose to move to an English speaking country or overseas somewhere to study and with that in mind, it didn't seem any point battling on with the German system IYSWIM. Until she started school (and hated it), I think she considered herself at least as German as British, if not more so. However with the schools (and me going on at home about "German schools" as if they were the spawn of the devil probably), she did feel more British than German, ie she rejected the German side because she rejected the schools.
I think if you are going to be here till they finish school and this is where their life is going to be, the only thing to do is to allow them to become German. This is actually what I did with dd until the school thing went haywire. She was basically a German kid with an English speaking home, although I was never rigorous about that either. As far as I was concerned, she could be German since that is where we lived.
I also think that trying to maintain equal standards in German and English education can hold them up and they need to have one strong(er) language as their language of education. In a way I liked bilingual education (but mostly I liked the UK-style teaching input), however I think you do your dc a favour when you allow them to function mostly in the language of the country they live in. It is hard to spread yourself in two languages to the same extent IYSWIM.
Just a thought. I know it is hard when you are not happy in a place but if you did have to stay, I would try to let go off the English a little. Try to always speak positively and respectfully about the country and its language/culture in front of the dc, the way immigrants for example in America are expected to behave and be happy to be Americans. I know it feels a bit odd but I think if they are to do well in the German system, you might have to go down that track.