The picture is certainly not fake and shows that even police officers are able to grin when they look at a carnival.
How is that remarkable? Well, it isn't. What you (and others in a similar thread) are suggesting is something quite different.
You suggest they march with the protesters and even "cleared their way". But that's not what they did, they were there to control the protest, to ensure that the action days did not achieve what had been planned, namely the BLOCKADE of the banks in the city for several days through spontaneous, peaceful protests going by the label "Blockupy". It was hoped this would revive the Occupy Frankfurt movement which no one mentions any more after 8 months or so holding out through the winter
The city government, conservatives in coalition and, shamefully in this matter, with full participation of the Greens had BANNED any and all activities that could have led to such a PEACEFUL, carnevalesque mobilisation effort. They prevented the blockade and occupation of the financial district and they won, with the gracious help of the officers you celebrate. Why on earth wouldn't these people have a grin on their faces? Four days of work almost over, 1400 arrests, lots of people kept out of the city, they pretty much shut it down, actually -- and finally some free carnival to boot, so what's there to worry about, right?
It is simply not true that all peaceful demonstrations in the US are met with batons and tear gas canisters. It is, however, very true that demonstrations that mean something, that our masters feel are getting out of hand are ALWAYS met with tear gas and batons, if not worse, and that is, unfortunately, true for Germany just as it is for the US.
Water cannons (with CS gas) in the financial district, just in case the way needs to be cleared:
http://www.flickr.com/photos/strassenstriche/7220990432/in/set-72157629771341004/