Are these the only choices to get close to Germany from JFK? There should be some DL flights as well as a bunch of SkyTeam connections through AMS or CDG.

For Christmas markets, personally I'd aim for Munich and plan to take the train to Salzburg for a couple days too.

For the two choices you present, I'd take the SQ nonstop over an AZ connection, although I can see the argument to save $700 and get FO status. I just think there should be a better choice on DL/AF/KLM that doesn't carry the full SQ premium. Look at seating configurations: 1-2-1 is best in business class, 2-2-2 is OK if you're traveling with someone, and 2-3-2 should be avoided.