I've rented a car in Munich before to do the same thing. I thought at first I was going to buy the extra insurance as my insurance company told me that they did not cover me in Europe, much to my surprise. However, my credit card company covered it as long as I used that card to book the reservation and pay the rental. You might explore those. I cannot remember all of the details of my rental but I believe I rented through Avis and it turned out to be a good bit more expensive than renting in the US.
I do not know for certain but have heard these sites might offer better deals than Avis, Hertz, Alamo, etc.
They usually offer different prices - with or without CDW.
Try this site for a cheap deal - but be aware that they have limited kilometers. It depends on how much you travel.
The Munich station is very close to the main station - that is very convenient (behind the Hotel K��nigshof).