> this lone University being the only example in all of Germany which I am aware of

Yes indeed this is the only state run distance-learning university, but I'd argue that you only really need one such institution. After all, you can study from anywhere :). They have regional centers in many German towns, but for most courses you only need to be there for the exams at the end of the semester, so you can also study hours away from the next regional center.

And it's quite successful. By number of enrolled students, it's the largest university of Germany at 77k, with the runner up having only 56k students.