The Germans do fix all prices, across the board, from apples to undies. Getting around that will be a big obstacle to releasing a 'critical mass' of material into the marketplace, which will in turn impede adoption of reader devices. The overall conservatism and lack of imagination of the average German is likely to be another. But authors who don't want to be jerked around by publishers are finding other outlets, like the admittedly itty-bitty Textunes.de, and libreka.de.
But I think the biggest problem may be that Amazon is not offering titles *in German* concurrent with its launch of the international version of the device. There are certainly sound business reasons behind that decision -- among them the likelihood that Amazon has not managed to complete negotiations with publishers in time for the launch. But it gives an appearance of corporate tone-deafness that could hurt the entire industry. But it might also give the Sony Touch a boost. Who knows.
Beware the new TTY code!