Sabbatical in Europe with 2 kids (5 and 2.5)

We have been to Ireland recently and also visited before.
Your plan in Ireland should include The Ring of Kerry and The Cliffs of Moher, on the west coast. Also, we loved Galway.
Kinsale is great, and near Blarney Castle. If you are interested in Crystal, do visit Waterford.
Also, we loved Galway and the area just north of Galway.

We lived in Augsburg, Germany for four years and did the Oktoberfest. I did it three times. The opening day parade is great if you can make it.
Still, Not sure you need three days of going to the big fest.

Can't imagine taking young kids to the fest. Not sure you can even take those young kids into a fest tent. The fest is fun and there is a lot of drinking, singing and such. If you want to try, I suggest you go for lunch when the tents are not as busy. Later in the day, it gets loud with everyone singing.
Also, lodgings in Munich can be hard to find during the fest. We always took the train into Munich. We went as a group from the office once and one guy was so drunk, he took the train to Salzburg instead of Augsburg.
Doing the castles in the Garmish/Fussen area would be fund.

You have a lot of options for visiting Northern Italy. Venice is special. I have not been to Tirano, but the Dolomites are great.

Your trip with young kids is still possible, but you will have to reserve car seats for them. Perhaps the rental car company can do that for you.
I suggest that you rent a car with a navigation system or you have a good GPS. Many car rental companies will charge you a lot to rent a GPS. Check to see if your cellphone works in Europe. T-Mobile does work in Europe, so I have been told.

Ireland has great fish and chips.

Hfaust37,
I loved Munich, although it's been several years since I was there, but my adult kids have been there more recently. One thing about Munich and environs is that puppetry and puppet theater seemed to be popular and common. I would seek out options for puppet shows there or in nearby towns if you have a chance. You don't need to speak the language to enjoy them.
I also caution about taking the little ones to the Oktoberfest meadow. The noise may be disturbing and less than enjoyable for the little ones. Definitely, check out the various venue options first.
One of my favorite museums in all of Europe is the Deutsches Museum in Munich. It is THE very best museum of science and technology, and there are lots of displays and objects that may fascinate your 5 year old, from mechanical clocks to planes, musical instruments, model railroads and robots. Also, be sure to be in the Marienplatz to watch the glockenspiel activity as the hour is struck.

In Ireland, my only comment is about the tour of the crystal factory in Waterford. The tour ends in the sales rooms and IMO it is okay, but not great. (I must admit that I have been to glass production sites in Corning NY and Murano Italy, so it isn't new to me, and one tour of someplace like that is enough for me.) I doubt if the little ones will enjoy it.

This is a great opportunity for all of you. Be sure to seek out parks for some running around time for the kids. I would ask parents you may come across about places they take their kids. My husband's family members that live in France do pretty much what we do there to entertain our children. Through the five generations in France that I have known, parenthood and childhood is the same everywhere. Amusez-vous bien!

What a fun adventure you will all have!
Some advice on Ireland: skip the Cliffs of Moher with the young kids. There are no barriers and it's a looong way down. I suggested checking out Dingle and the sheep herding farms. Also Killarney with it's park, jaunting carts, Muckross Abbey and Ross Castle. Galway would be fun for all ages. There are also "forest walks" for families on weekends all around Ireland. They are a fun way to connect with nature and learn about some of the Irish forest stories (ferries are a big part of the Irish lore.)
As others have mentioned, Oktoberfest isn't super kid friendly, but if you want to check it out I'd go when it first opens or during lunch.
Italy can be super kid friendly. I'd suggest looking at Lago di Garda, Bolzano and the Dolomites. Also Venice might be fun for the whole family. If you want a bit of a beach break, you could head down to Monterosso al Mare (Cinque Terre) to stay for a few nights of beach, beauty and relaxation (of course the lakes offer this as well.)
Happy planning!

We visited the Cliffs of Moher in July and there was a barrier. Not a problem with kids. You can walk up the steep hill to the viewing point, or take a motorized small vehicle.

I thought that the Cliffs were the MOST scenic item we saw on our tour.

To be sure, the cliffs of Moher are beautiful. However, I would not go (nor recommend going) with very young kiddos. If one only visits O'Brien Tower, there are barriers. But to me, the real beauty is hiking the trail(s), which do not have barriers (in fact one part is closed for quite some time.) With young kids there are so many other, equally beautiful places to enjoy rather than the cliffs. Just my opinion as a frequent Irish traveler.

You've only mentioned about half of your trip. Are you not taking the full two months in Europe? If you are, it would help to know where else you are going, as well as what your interests are.
You say you want to fly from Killarney to Munich. Kerry Airport, which is closest to Killarney, does not appear to offer direct flights to Munich. Probably Shannon or Cork airport would, though. I would consider flying into Shannon, as well, since your travel plans are mainly in the southwest.
The Cliffs of Moher, the Ring of Kerry and most of the beautiful scenery are lost on children. The Giant's Causeway is an exception because kids love to jump between the basalt columns. Which is not to say that you shouldn't visit the Cliffs of Moher. They're spectacular, and you don't have to hike to see them. You also don't have to stay all day. The Ring of Kerry is a half- to full-day car ride that I would not consider doing with young kids.
Ireland is very kid-friendly. They are allowed in the pubs until usually 8pm. There are lots of beaches, which children generally love, even if the water is a little cold. There are lots of farm-stay and glamping opportunities.
Speaking of cars, if your parents go, you'll need more of a van to accommodate 6 people.