I have an issue re German citizenship with some legal complications. I think the principal issue is this: does a German woman lose the right to pass on nationality if she registers with another nationality, but does not become naturalised?

What I think are the main points:
1. a woman with German nationality married a British citizen in 1972 (Britain was not yet a member of the European Economic Community).
2.  At that time the wife of a British citizen did not need to undergo naturalisation to acquire British citizenship; she registered as a British citizen, without naturalisation, and with no need to renounce any other citizenship. As a registered British citizen she was able to remain in Britain with her husband and to work there. (Naturalisation and registration are different paths to acquiring Britsh citizenship).
3. Her son was born in 1980 (by that time German nationality could already be passed on by either the mother or the father).

Documentation: formal post-war recognition of the mother's German nationality; proof of British registration; applicant's birth certificate showing mother's name, etc. None of this  is in doubt.

As I understand it, if she had become naturalised as a citizen of another country she would not have been able to pass on German citizenship. But does this apply to citizenship registration? This is a question for someone possibly familiar with both the detail of German law, and the British procedure of registration.

Other points: I think the 3 points above summarise the issue. But, in case they are relevant, I provide more details.

The mother's parents (the potential applicants grandparents), a German judge and his wife, Jews, fled Germany in 1937. Like everyone else in their situation, their German nationality was revoked in November 1941; they had not adopted any other nationality (and never did). Their daughter was born in 1942. In 1953 the parents' German nationality was restored, the father's university degree as a judge (which had been revoked) reinstated, and their daughter - the mother of the present potential applicant - formally recognised as a German national.