So canon has Dutch and Danish units operating in S. Germany? This is one of those times when I wonder what the writers were thinking. It makes a lot more sense, logistically at least, to have them operating closer to home, in N. Germany and instead shift German, American, or UK units south to counter any Pact advances there. But that's moot, I suppose. If a rational explanation justifying canon can be made, I say go with it.
That said, I think your explanation/rationale for the canonical location of the Dutch and Danes works pretty well.
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