I think I would move on.
Ok, here's the thing, I don't get that you are looking for a high level schutzhund competitor, or a dog that you would like to take to a national championship in the conformation ring.
$1,850 is upper end for a 8 week old German Showline puppy. Yes you can find some for $2500 or even more, but average is in the neighborhood of $1,500. Either way you are definitely in the ball park. If you are going working lines, they are generally a little less. I am guessing that you can find working lines that are more sought after and will cost you more, either because of their ancestry or the level of accomplishments of sire and/or dam. My point is, you can probably find a very nice pet in the $1350 - $1500 range, STILL go to a decent breeder, and get the dog you want with a more present breeder, if you go to a breeder who isn't breeding 5-6 bitches within 3 months.
I am not saying the breeder is no good, I am saying it isn't a fit for you and your family.
I have an issue with them knowing the breeding will have a LOT of males, feeling confident that though you were fourth on the list, you would have males to choose from that fit your bill.
Let me see,
Arwen/Dubya #1 -- 5 males, 2 females
Arwen/Dubya #2 -- 3 males, 5 females
Babs/Rushie -- 1 male, 6 females
Jenna/Gispo #1 -- 6 males, 4 females
Jenna/Gispo #2 -- 4 males, 3 females
Babs/Herko #1 -- 2 males, 1 female
Babs/Herko #2 -- 1 male
Jenna/Herko -- 3 males, 5 females
Bear/Herko -- 5 males, 4 females
Odie/Obi -- 1 female
My point is, out of 10 litters, 3 would have given you a choice between 2 or 3 puppies. that is, if they happened to have the color you wanted. And if other qualifiers did not disqualify one or more of them. And many of those were good-sized litters. To suggest that it is probable to get what you are looking for as the fourth male pick.
It sounds like if you ran out of suitable males on litter 1, you would be first in line for litter #2, but that isn't how it works. Sometimes, for example, the stud fee is a puppy, and if the male is very good, it may be a pick puppy. And then it depends on what the stud owner wants whether they want male or female. So you may be bumped to #2. But if people that want these dogs CHOSE litter 2 and knew they would be PICK 2, now suddenly you are pick 3 or pick 4 AGAIN!!! I mean, it isn't the person or persons who chose litter 2's fault that your bitch did not whelp.
These people obviously have a LOT of puppies and have a LOT of puppy buyers. They had some misses, or whatever, and came up short. But they are not concerned about losing the customer. Partly because their puppies didn't happen, and partly because they have your healthy deposit and it is non-refundable.
What I would do, is find a couple of decent breeders who have litters on the way, and choose one once the puppies are on the ground, and you know how many males there are, and what the litter is likely to produce. Then you ask whether anyone has a deposit down, and you choose at that point if you want to put your name down for a puppy from the litter. Then you tell your kids the date that you are going to bring the puppy home. Of course it is ALWAYS possible to lose puppies after they are born as they are living creatures and susceptible to many things, but your chances are excellent for bringing hope the pup on the date if you wait until pups are on the ground.
I think the wife would be open to this plan if you look in a price range that recoups some of your loss. But, then you are giving the breeder you are with $500 for nothing. It is a stiff lesson.
I usually do not let prospective puppy buyers know that puppies have arrived for about a week. That way I am pretty confident with what I have. I am not a big fan of deposits, exactly due to the problems you are having. A lot of good breeders like to give the buyer a pick between two or three pups that best match what he is looking for, and not simply the #2 or # 4 male pick. This is because we mark behavior on the pups from 3 weeks and up, and might see that one is a lot more drivey and should be put with someone with an active home, another might be more independant and may need an experienced owner. You take your middle of the road pups and give people a choice between them.
Some people though know what they want and how to pick the best puppy, and that person may be given a choice of all the males.
Jenna, RN CGC & Babs, CD RA CGC HIC
Heidi, RA CGC
SG3 Odessa, SchH1, Kkl1, AD
Ninja, RN CGC & Milla, RN CGC
Joy, Star Puppy, RN CGC
Dolly CGC & Bear CGC