car drop off

Airport. Airport is out of the built up area. Easy to drive through. In my (limited) experience downtown Munich traffic can get very busy with traffic jams at commute times. There is also a Lufthansa bus from the airport.

Dropping off in town is no big deal, especially if you have a GPS.
I picked a car up by the train station during Oktoberfest and the traffic wasn't too bad. Of course part of it will depend on what time of day it is.

I find Munich (like Germany in general) very easy and sane to drive in. You should have no problems dropping off in the city, if that's what's most convenient for you.

Unless you are going to the Marriott by the Nord Friedhof, it will probably be faster and definitely less expensive to take the S-Bahn vs the Lufthansa bus. If you use an MVV Tageskarte for the trip into town, it will cover any other travel by public transportation the rest of the day in Munich. It might be more expensive to drop the car at the airport rather than a location in town, plus you would have the S-Bahn fare into town. Depending on the rental company, there are probably a lot of places outside of town (Rosenheim, Garmisch, Augsburg, Würzburg, etc) to drop the car. You can then take a train into Munich using a Bayern Ticket for €21 Single, €29 2-5 P.

I also think driving into the center of Munich is easy. Like any city avoid the morning rush hour - after that it's no problem. A GPS will get you easily to the street address you need. If you don't have a GPS, a map plus the logical German road signs shouldn't be too hard.

I dropped off at the railroad station and it was no problem driving to thearea of the station.However when our GPS indicated we had arrived we couldnt see the Avis office.We finally had someone get out of the car and walk and then we found it.It was a down ramp with the only sign about1 foot square in the ramp. We were told everyone has problems finding them but they are not allowed a sign that anyone can see.

My experience of driving in Munich was very stressful, partly because of the traffic and the pedestrians and bicycle riders who stepped out/rode out into traffic without warning. There was also road construction and detours that sent me off in an unintended direction. Dropping the car off at the airport, on the other hand, was a piece of cake, although my failure to fill my 3/4 full tank with gas (see earlier stress...) resulted in Hertz charging me more for gas than the entire cost of the rental!