I was a Fulbrighter in Germany 2010-2011 and I can tell you that once you've established your German bank account (recommend Deutsche Bank because of 1. English online banking 2. you can withdrawal at any Bank of America ATM for free if you decide to keep your account open 3. There's a DB in almost every major European city) the Kommission will reimburse your travel expenses. Everything question you ever had will be answered at orientation. It was an amazing year, and I wish everyone the best of luck!
PS: I took a German carrier (Condor) from Anchorage to Frankfurt direct and it was the cheapest fare possible ($600 one way, $800 way back) so there was an exception to the "Fly American" rule. Also, they reimburse up to $1200 for a round-trip ticket although that could change because of funding. The German Kommission is AMAZING and actually sent me an email towards the end of the year telling me how excited they were that they could give me $400 more for my return ticket. So nothing is set in stone, they're happy to help you in anyway possible. I owe a lot to the ladies in Berlin! AND Cara Doble....great asset to IIE.