There's one more in that episode where the Top Gear team competes with a group of German motorists where Jeremy said along the lines of "They want us to find a place to do the competition, and I suggested the skies above the English channel"
I am German and I find the trios' Germany jokes totally hilarious and extremely funny. Why would I feel offended? Instead I'm happy they mention my country at all and they do it in a truly (and innocent) way.
Oh come on we all know the story of how Viscount May of Hammersmith and 55 RAF or the Hammersmith Cockerspaniels assisted the Duke of Hammond during the North Africa campaign of 1943!