Do you have any examples? I could never find anything larger than a matchbox in a village for under $200k in Germany.
Anything decent I found in the outskirts of any big city was over 500k.
Here's a quick search for houses under €100k with at least 100m^2 and 3 rooms (2BR) in Brandenburg: https://www.immobilienscout24.de/Suche/de/brandenburg/guenst...
It returns 83 results & while not all of them are within 1 hour drive from Berlin, at least a bunch of them are.
Also if you're in the affluent south or west of the country (which I suspect is where you searched?) you will have far fewer options for cheap housing than in the depopulated former East-Germany around Berlin. You definitely can't repeat this "trick" outside of Munich.
Nobody in their right mind would want their kids growing up there.
In family friendly places with jobs the properties are far from cheap.
Also not sure what counts as looking bad to you, a lot of these villages or small cities are actually quite nice looking (we often go to such places for a day trip) & if I was single/childless and wanted to live a quiet life without much disturbance I'd definitely check them out. They are mostly just not in easy commuting distance to jobs.
In fact some of the places in Berlin with the highest rents (like Kreuzberg) are often a lot uglier than sleepy Brandenburg villages & small towns.