Even if you are flying in and out of Terminal 2 in Munich, you would be coming in on a Schengen flight and leaving on a flight to a non-Schengen country, so you will have to go through outgoing passport control in Munich, plus, as I remember, change levels in T2. You might be able to do all of that in 70 minutes, including deplaning and boarding, but there are too many reasons that the Athens flight could be late. If the ticket were all Lufthansa, they might find you another flight to the US, but how many of them are there in a day.
And if you are flying any other airline than Lufthansa into Munich, it probably means changing terminals, which would be difficult in the time provided.
On the other hand, with the other flight, you would go through immigration and custom in Newark, and that could take a big portion of the 3h20. Plus, if the trans-Atlantic flight is late, there are probably many more flight options from Newark to DC.
I'd take the Athens to Newark flight. I'd rather be almost home when I missed a connection than thousands of miles away.