The academic communities in Germany and Austria, and also the German speaking part of Switzerland, are so much intertwined that it will hardly matter whether you get a degree in one country or the other. I think academic mobility between these countries is so high that it's not really distinguishable from academic mobility between say different regions of Germany. When you heard that most researchers or professors in Germany studied in Germany, I think what was meant is that they studied in German-speaking countries.
Degrees from Austria would be seen as in principle equivalent to their German counterparts, but of course professors would to some extent be familiar with whether a specific study program in another country is a good or not so good program, similarly like they would be aware of that for programs at other universities in their own country.
Regarding the MSc vs. Dipl.-Ing., you should be aware that the MSc was introduced in German engineering programs only maybe 10 - 15 years ago, so many professors in engineering will still have a Dipl.-Ing. degree themselves!
Overall, if the particular program that you are interested in is of a similar quality than possible alternatives in Germany, getting a degree in Austria will not impact your career options in Germany.
One point maybe is that irrespective of the country it can generally be a bit easier to get a PhD position in the same university where you are doing your master than somewhere else. If you have particular universities in mind where you'd want to do a PhD, whether German or Austrian, it could pay off to try doing already your master there.