It's hard to say without specifics. I don't know to which kennel you're referring (although even if I did, I might not know anything about it, since I'm not in that area).
About all I can say based on this very general description is that hearing that the animals are housed in a kennel facility (which sounds like it may be a fairly large one?) and are being evaluated on whether they're "clean" and "well fed," combined with hearing that there are two different lines of dogs being produced, raises my antennae a little and makes me wonder if this is not a commercial operation.
Not all puppy mills are squalid and dirty. This blog post talks a little about modern "high-tech, clean, humane" (although personally I'd disagree about calling them "humane") mills: Redefining the Puppy Mill | Ruffly Speaking
So... that is my first instinct when someone describes to me a large, clean, "well run" kennel producing different types of dogs: I wonder if we're talking about a high-volume commercial breeder.
But it's just a suspicion. There are good breeders who house some or all of their dogs in kennel facilities. There are good breeders who produce one or two different types or breeds of dogs. So it is entirely possible that the breeder you visited is, in fact, an ethical and knowledgeable breeder.
But I wonder. The show and working communities in GSDs tend to be highly split, and in general, serious breeders have chosen their preferred type because they truly believe that it's what the breed should be. My understanding is that it is unusual (not unheard of, but unusual
) for a breeder to seriously pursue and produce two different lines in this breed.