Sure. I'm very happy with my own umlaut dead key on AltGr+; as that's easy to hit, but for a German typist I'd recommend a proper key for Öö and Üü instead. See my locale topic (linked from my sig topics). If the need for German is only occasional, I'd make two layouts with brackets or letters on the bracket keys, and use a hotkey to swap between them (if you really need more accessible brackets too now and then).

If your need for German is rare enough, then a dead key may be the best option nevertheless.

Not using the ISO-Angle mod is bad for your wrist, but hey – your funeral! ^_^

If you're using a proper layout and not just a "VirtualKey" one (well, actually anyway), the umlaut dead key looks like this in the layout.ini file:

SC01a = OEM_3	0	;	:	--	dk13		…	; QWERTY pP - dk_umlaut

You'll want to move the dk13 (or whatever its number is in your layout) from the SC01a key to SC056 which is the scan code for the VK_102 key.

SC056 = Z	5	z	Z	--	ʒ	Ʒ	; QWERTY zZ

Here's mine, which is Angle modded of course. (That number 5 is because both level1/2 and 3/4 on that key are shifted versions of each other.)

All this is also nice on a Wide mod, as the dead key or special letter keys work well in the center of your keyboard.

   
    German (Germany and Austria) 'Unified Symbols' Colemak[eD]

Yes, you can mix VK and non-VK in the same layout without worry. You just have to replace the one key from one of my other layouts, and edit that a little.

VK just sends the Virtual key code for the key. The key has a scan code which is what the OS sees when you press a key, then that gets translated to a VK code. After this, the OS will decide what to do with that key press depending on modifier state etc. So in PKL, a VK mapping means that you just send the key's "position" as you say and let Windows handle what happens with Shift/AltGr/etc. A full key mapping in PKL like the one in my previous post, handles these levels and sends an Input Event instead, which is a glyph or similar actual result of a key press.

The columns of a full key mapping are:

SC01a = OEM_3	0	;	:	--	dk13	…	; QWERTY pP - dk_umlaut
SC    = VK   	SS	L0	L1	L2	L3	L4	; comment

SC & VK: Scan code (hard) & Virtual Key Code
SS: Shift state (+1 if L0/L1 are non-/shifted versions of the same letter; +4 for L3/L4)
L0–L4: Normal, Shift, Ctrl (not often used), AltGr, Shift+AltGr

Ah, yes – running several keyboard hooking AHK scripts at once can be fun. :-)

Short of poking around for PKL info on forums, I'm not sure what to recommend. Máté Farkas hasn't been in touch for years, and his English wasn't so good. The source code is available, but a tough read. I've a feeling that my posts and the README in my PKL files are among the better information sources these days...

Having puttered around with hardware remapping devices quite a lot lately, I think I may finally be ready for a bout of PKL tweaking now. Let's hope that gets good! :-)

It's possible to use PKL only to get AltGr mappings only, so you can have your keyboard's layer mappings active and still get the dead keys and stuff from PKL – as long as you don't let your keyboard capture the layer that PKL dead keys are on! I keep nearly all my dead keys on AltGr+(symbol)key for consistency and ease of use.

I have ß on AltGr+s by the way. ;-)