As Alarm im Kasperletheater, this book is a riff off the usual characters of a Punch-and-Judy show. There’s the Robber, Hotzenplotz, who opens the book by stealing(!) grandmother’s coffee grinder, which is particularly beautiful and plays a melody while you grind the coffee.
Kasper and his friend Seppl decide to track down the dread Hotzenplotz and get the mill back. They go into this with a wonderfully elaborate plan that completely falls apart, so that they are captured by Hotzenplotz. Hotzenplotz doesn’t really have enough space and work for two boys, so he sells one of them (Kasper, disguised as Seppl) off to his friend, the wizard Petrosilius Zwackelmann.
This is where the story is the most relatably German thing ever: Why does a wizard need a servant? Petrosilius can do anything: fly, transmute matter into gold, prevent Kasper from climbing the wall and escaping. But he cannot use magic to peel potatoes. Yup! And he sure does love potatoes, so Kasper is put to work to peel, and cook lots of potato-based dishes.
Of course, there is a meeting with a fairy and clever escapes and daring plans, and a good ending where everybody is happy, except for Hotzenplotz. It really is a nice book. Don’t watch the movie, though.
Hotzenplotz has been translated a lot, and has received some adorable names in other languages, such as Le Brigand Briquambroque, Il Brigante Pennastorta, El bandido Saltodemata, or Haydut Haytazot.
Alarm im Kasperletheater is another German book for children that uses the Punch-and-Judy characters, though in a very different way.
Another good children’s book by Otfried Preußler is The Little Ghost. If you’re looking for more serious books by him, Krabat is my favourite by far.