Rick's itinerary is crap. Start from scratch and ignore what you've read (and some of what you'll read here from acolytes who only follow his suggestions and ignore that there are other ways).
Into Frankfurt and out of Berlin is good. Frankfurt's market is nothing special but the city is worth a couple nights (one full day) at least, more if you're into art and Jewish history. It's a good place to recover from jetlag as well.
I know I'll be accused of bias, but I've been all over Germany for Christmas markets, and my suggestion is to take the ICE (book early) south to Stuttgart for 2 nights to do the Stuttgart, Esslingen, and Ludwigsburg markets. Stuttgart's market is the finest "big city" contiguous market I've seen, but the city is not touristy. It's home to the excellent Mercedes Benz museum even if you don't like cars, it's well worth a visit. Esslingen has a famous "middle ages" market that is my favorite in all of Germany. Ludwigsburg exists thanks to a Baroque palace and it's market is elegant with great crafts, italian meats, and the special "feuerzangenboelwe" a special alcoholoic punch that must be experienced. Base in any city - they're all only 15 minutes from each other by train.
From there, Munich is just over 2 hours (Ulm also has a decent market and a separate middle ages market if you want more of that scene and is on the way). Bamberg is glorious although it's market isn't special, but there's also Nurnmberg which is the home of "German Christmas" and has one of the largest markets. You could chose another stop on the way to Berlin (I haven't spent much time in East Germany so I don't feel qualified to comment) and end in Berlin with over 50 unique and radically different Christmas Markets, it's the perfect tend to this trip.
I'd largely forget about "outdoor" activities though, unless hiking through brown and grey forests in slush is your idea of a good time. Maybe check out some Alpine activities near Munich in Bavaria. That's your best bet for nice winter scenery. Aside from the mountains, things will be dreary, that's why we have Christmas markets to enjoy!
Sorry, just read that you're skiers. My German skier friends don't have a high regard of German slopes - most tend to go to Austria. However for a 17 day trip I wouldn't bother with the timing. A Bavarian ski resort should be just fine, just don't expect it to be amazing.