Actually, it's not. It's also ok to show it in movies and books in general if it's not an endorsement. So, it should be ok in video games, too, unless you get to play the Nazis.
I heard from a German friend that Afrika Corps vs Desert Rats where you get to play as either side in the war is allowed for sale in Germany and a quick online search confirms that. Though they have different covers and slightly different names for the UK version and the German versions.

