Let's take this level of user tracking for DNS would be accepted & fine by Germany as well as what folks were thinking was feasible for the company to do as a given, how does it prove the user+ip who registered is the user+ip who submitted the request instead of the place it got proxied? Or malware enabling the same?

If you can solve this for me it would actually help a lot at work :D

Just shift the legal burden of ensuring that no unauthorized users use an IP to the legitimate user of the IP /s

Germany did this, it made free wifi illegal.

It is my understanding that getting infected by a botnet is not illegal yet, so there is room for improvement.

It could be in Germany until the law was reformed. You were civilly responsible for whatever the botnet did.