I agree with the previous posters that total immersion is the best. I work at a school and I find it takes some kids up to a year to really settle in and make good friends, so I would not consider putting them in a school for a year and a half and then changing it. I also think that the motivation to learn German in order to make friends is important, otherwise the kids retreat to their groups of English speaking friends, because it's the easiest thing to do. Encourage your kids to be brave and not afraid to speak and they will learn very quick.

Good luck!!