The article ended with the students saying that they planned to stay in Germany - they didn't want to go back to a country like the US where their children might be bankrupted paying for their education.
I didn't mean to come off quite like I originally phrased that, more of it might be interesting for the perspective gained. Also, when I was in Berlin for 2 weeks (the GNOME/KDE Desktop summit) several years ago, I'd have stayed as well had I not been married. Wonderful country (and my family is racially of german descent so...)
It has less to do with being a bad driver and more with your learning progress. If you're a bad driver, you shouldn't pass the practical exam no matter how often you take it -- and your driving school shouldn't send you to it in the first place.
Case in point: I paid for a ridiculous number of lessons because I switched instructors halfway through and was full-time self-employed. If I had been able to keep a tighter schedule I could have done it in a fraction of the time. I passed the written and practical exams on the first attempt but what bloated the costs was having up to two week gaps in between driving lessons.
To expand on your summary: it's 12 classes (only two classes that are mandatory, for the rest you just have to show up to ten of them in total, you can go to the same class multiple times) but going to those classes is rarely enough to pass the written exam, so you normally also get a book. As the written exam is a (mostly) multiple-choice test with questions from a well-known pool, there's also software that lets you train the exact pool of questions which your exam will be based on. Many driving schools have you take a simulated exam before they give you the paperwork you need to sign up for the real thing. How long it takes you before you can pass the exam mostly depends on how good you are at rote learning.
The 12h driving consists of various lessons. These include various scenario-based lessons (i.e. driving on the Autobahn, driving at night-time and driving on rural roads). You have to take a specified number of lessons for each scenario. You also have to take a minimum number of regular driving lessons but most people I know have done more than the bare minimum for various reasons. Most driving instructors do these lessons in batches of two per session (as, depending on traffic, you can easily spend half a lesson just getting to the training area and back).
I think this part is different from the US: driving lessons (even the very first one) are generally done in real traffic. Although you often do a few of the early exercises in safe environments, many instructors make you drive there and back. Driving instructors are trained to operate cars from the front passenger seat (which, btw, is called Beifahreritz -- literally "co-driver seat" -- in German) using a second set of pedals and mirrors the training cars are equipped with; so they can always take over and simply grab the steering wheel if necessary.