Realistic? Car from Munich, Bavarian Alps, back to Dachau, drop car in Munich, train to Berlin

Viamichelin says 1 3/4 hours Fuessen to Dachau, figure 2 hours with traffic if you leave at 8:00 am
You might want to check the website, https://www.kz-gedenkstaette-dachau.de/index-e.html
It says the parking lot is partially closed for construction, so keep that in mind.

There is an ICE Sprinter at 5:57 pm from the Hauptbahnhof that will get you to Berlin in under 4 hours.

So, yes it is doable. A lot depends on where you pick the car up. There are a lot of rental agencies by the Haupbahnhof. You could also turn the car in first, store luggage at the station lockers, then take the S-Bahn from there to Dachau and take the local bus to the camp. Return to the Hbf and collect your luggage then get the train to Berlin.

Concern about D3: Early pick-up of rental car. How early do they open up?

D5: In general doable but afternoon rush hour into Munich plus car drop-off to get a train can end up a stressy situation. How about dropping car in Dachau and getting by train back to Munich to head on to Berlin?

Maybe depending on weather I would switch order and visit Dachau in afternoon of D3 and heading on to Oberammergau. Then you would have D5 completely for Füssen to Munich, e.g. by visiting also Andechs. Advantage is that Dachau Memorial is not your last experience in that beautiful area.

as long as neither pickup or dropoff is a Saturday afternoon or a Sunday or a holiday

Europcar - an Autoeurope rental car provider - has a Dachau location. Drop there, take the train from Dachau into Munich. If you're buying train tickets to Berlin, you can specify Dachau Bahnhof as your "From" station at the DB itinerary search page.

"I appreciate thoughts on this plan"

Your "plan of attack" is not uncommon but there are many things to do in the area you're headed to, and I don't quite get the appeal of building a visit around all three of those palaces with so little time. I'd suggest shopping around for a little diversity of experience to get a glimpse of the region and the local culture. Maybe some of the options below would interest you and could replace one or two palaces.

https://www.zugspitz-region.com/regional-specialties-and-dining/cheesmaking.html
https://www.zugspitz-region.com/the-ammergauer-alps/traditional-arts-and-crafts.html
https://www.zugspitz-region.com/regional-specialties-and-dining/the-ettal-brewery.html
The much-overlooked Hohes Schloß in Füssen, with a history of some 700 years.
The Fraundorfer Inn's "Bavarian Evening" in Garmisch-Partenkirchen
The Karwendelbahn, the Leutaschklamm, the violin-makers and folk-life museum, and the other charms of Mittenwald.
Ettal Monastery

My personal preference would be to see all things in Munich (including Dachau) before departing via train (Bayern Ticket) to the castles. Pick up a rental car and check into your hotel in Schwangau-Horn with a view to the castles. Drive to see Linderhof - it's an easy fairly quick drive) and then when you're finished, drop the rental car off and get back on the train to Berlin (via Munich) for the 7 hour journey.

This terrific feedback has me rethinking my plans. I don't relish the idea of renting a car in Munich central and driving out of the city, so I could train to Oberammergau(where I already have a hotel) , pick up a car, and tour the area from there, having the freedom to go where we want. Maybe drop the car in Fussen and train back to Munich for the trip to Berlin. Driving is freedom, but stressful. I am checking out the suggestions for other things to do, and rethinking my multiple castle idea.

I just didn't want to cut short the Munich time with the trip to Dachau taking 1/2 day. I could forgo Dachau and go to Sachsenhausen instead, but that cuts into Berlin time. Right now I have 2 1/2 days in Munich and 4 days in Berlin (assuming evening travel to Berlin). Potsdam is one day trip from Berlin, so actually 3 days in Berlin.

I think the alternate plans offered by others are good. I was going to add that if you do decide to rent/return a car in Munich, the rental car offices are on the 2nd floor of the Hauptbahnhof. The pick up/return the car is in a separate building about 2 blocks away, so you will want to take that into consideration with your timing.
I didn't find driving in the area from Linderhof to Fussen too stressful. It's very beautiful and the traffic isn't horrible as compared to the Autobahn.
Have a great trip!

I am now considering staying in the countryside for the 3 days, and seeing Dachau during the Munich segment (or going to Sachsenhausen when we get to Berlin).

Does anyone have experience with the overnight ICE trains? We can train from Fussen to Augsburg to Munich, but the last segment is overnight. How is sleeping on the train overnight? I think it is just seat-sleeping?

" We can train from Fussen to Augsburg to Munich, but the last segment is overnight. How is sleeping on the train overnight?"

There is no such thing as an overnight train between Augsburg and Munich. It's a trip of 30 minutes by ICE train. You've entered some bad info into your search.

"Driving is freedom, but stressful."

That's my general feeling about it... contracts, deductibles, responsibility... designated driver...

It's maybe natural to assume that you would need a car for day outings from a small town like Oberammergau, but it's also false. If you don't wish to drive you can work it out. At the DB site you will find direct trips to Linderhof, Ettal Monastery, Garmisch-Partenkirchen, and other places. Fares are very cheap in this area as well... Here's a map of the immediate transport network:

https://bahnland-bayern.de/assets/images/4/BEG_GR_Regio-Ticket_Werdenfels_2016-09-Ansicht-6e09290c.jpg

For some choices, a car might be best. But you might only need it for a day.

The forum member with the best personal knowledge/experience on getting around here without a car is probably Lee. I believe his experience includes Oberammergau as a base town. You might want to consult him via the forum or PM once you have all your destinations studied and penciled in.

To answer you question, I don't have experience with overnight trains, but I'm not clear on the need for the overnight train unless you planning leaving very late in the day. The train from Fussen to Augsburg is 1 hour and 45 minutes and then the train to Munich from them is 30 minutes. The ICE train from Munich to Berlin is 4.5 hours. If you leave early in the day you would make it to Berlin in the early evening.
Maybe I misunderstood your question.

There are a few ICE Sprinters that do Munich-Berlin with limited stops in under 4 hours. There is really no reason for a night train. Deutsche Bahn and the German government just got done spending billions on "debottlenecking" the Munich-Berlin rail line.

Well, maybe I misunderstood as well...

If you mean for Munich - Berlin direct, leaving at 21:51 or so... I'd try a different approach. If you don't sleep well it makes for a bad day afterward.

I sure was unclear! I searched my intended route of Fussen to Berlin, leaving as late in the day as feasible so that we could enjoy most of the sunlight time in the countryside. The route came up as going from Fussen to Berlin through another city than Munich. I just searched again and it came up as a 7 1/2 hour trip including the 51 minute layover/stop in Munich. The search also shows being able to drive in less time, but that is not appealing to me at all. The train sounds like a good plan, even if it does get into Berlin at 11:30!

I also liked many of Russ' s suggestions.