Thank you all for your input. I believe we are going to take the train from Biel to Lindau, pick up a car, and go from there. We'll spend our 8 days exploring, and then drop the car off in Berchtesgaden before taking the train to Munich for our last 2 days.

We've already travelled Switzerland and Italy by train, so this should be a different experience and perspective for us. We're excited now! Of course, my husband wants to rent a Porsche...not quite in the budget! :)

>Of course, my husband wants to rent a Porsche...not quite in the budget!

It's twisty country roads we are talking about, not the Auobahn. A sports car can be fun on those, but only if you are well acquainted with the roads. And you never know whether there is a tractor with 2 tons of manure in a trailer behind the next bend.

depends what one means by 'fun' i guess

With 3 people and that itinerary I would definitely drive. It give you much more freedom to go exactly where you want when, explore any cute little places you find - and not be stuck with someone else's timetables. I would think with 3 the car would probably not cost much more.