They're talking about the division between Gymnasium, Realschule, and Hauptschule. It's actually state to state nowadays whether they have separate schools or Gesamtschulen, but I understand even in Gesamtschulen, in many Bundesländer there's some internal separation.

Where are you in DE, that this is unknown to you? In Köln just 15 years ago I knew parents who had the horror scenario: a 4th grade teacher who quietly believed that girls shouldn't go to university. They switched their daughter schools that year.

this is very reductive and really hyperbolic. Also hauptschule does not exist in most states anymore.

I also know enough people who did perfectly fine via Realschule to academics. Of course it's a decision with pretty much a single point of failure which is suboptimal, but don't act like it's predetermining your whole carrer.

I guess he is talking about the three school types you can go to after elementary

or four (adding Gesamtschule) but yes, the what she's talking about.

as others said: Schullaufbahnentscheidung vierte Klasse (at the age of 9 years for most Students)