Yes. With local files as icons etc, if you hit "Save As", and select the KMZ format, it should include the files in the zip. If you save it as a KML, it can't because it's a flat file, not a directory structure as per KMZ. I know the file you uploaded was a KMZ, but I'm assuming it was copied/pasted as a KML at some point. If you copy a feature or entire directory in Google Earth, it does so as a KML.
BTW, I'd be interested in whatever you have for the Netherlands and Belgium. I posted something a month or so ago about Belgium, with what I *think* is the Antwerp area.
Right oh. I had an idea that was it, as KMZ files are usually a fair bit bigger than KML files, indicating that there's more going on inside them. I used to upload KMZs to the BAOR Locations site and everything was sweet. Dunno what's happened since with the Germany one.
By way of an experiment, I'll upload zipped versions of freshly minted KMZs for Belgium and the Netherlands and perhaps you can tell me what comes out the other end.