Ramstein is great but the germans seem to look at it as fluffy punk rock. 
No, I'd say more look the way that Glam Metal of the 1980s is viewed now. Germany has a pretty serious metal scene, and Rammstein is a little light and poppy for it, plus too commercial and has too many teenage girls wanting to be cool by loving Rammstein's music. It's also no way viewed as being punk rock (Germany has enough fluffy and hard punk rock to know the difference). Being a fan of German punk (and Rammstein, for that matter), I can be fairly sure that it isn't viewed as fluffy punk rock.
Another issue has always been Rammstein's flirting with the far right making most Germans uncomfortable, such as the video clip that used the Leni Riefenstahl footage. Whilst Rammstein mightn't be a far right band, it's provocation in that direction does worry many Germans.
And, no, I'm not even German. Wow, what does that say about me?
