Despite common belief, the monetary cost is not the deciding factor when it comes to adopting a new item of equipment.
What advantages it has over the currently used item and how it fits with national interests & military doctrine have far more impact on the purchase of new items of equipment.
Otherwise, we'd all still be using bolt-action rifles.
Why are we not using bolt-action rifles despite the high cost at the time to replace them and replace all the equipment used to make them and their ammunition?
Because self-loading rifles offered more benefits than manually loading rifles.
The monetary cost was not as important as the potential advantages gained by shifting to an entirely new type of rifle despite the need to build new machinery to make those new riles, despite the need to manufacture new ammunition, despite the cost to train the military in the new rifle etc. etc.
In regards to the G11, HK were advertising the system to other nations and showcased it in one of the Scandinavian countries at the time, if my memory serves me well, I think that one of the members here actually witnessed it at one of the arms shows in Scandinavia and spoke to the H&K reps about it (if not one of the members here then it was on another Twilight: 2000 forum).
Plus there was the possibility that the US military might adopt a version of it for their ACR.
Other nations purchasing the G11 would have lead to mass production which would have lowered the cost overall.
In regard to the G36, it's unlikely it would have been developed given the history of the Twilight War. The fallback rifle in case the G11 was not accepted was the G41 and even when the G11 was accepted for service, the G41 was also offered as the rifle for personnel not needing the G11 i.e. rear area personnel.
Due to the end of the Cold War, West German national interests and military doctrine changed. They no longer needed the benefits the G11 could have given their troops and the money they would have spent on bulk purchase of the G11 and all its extras was instead used to integrate East Germany with West German.
They stuck with the G3 and waited some time before deciding to switch to a 5.56mm rifle which as we know was an entirely new development from HK, the G36.
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That pretty much says it all. If costs were the main deciding factor, then the Dreyse mechanism would have conquered the world, and we'd still be using it.
In fact, around 1991, it was a very close call that the 4.73mm family became the new NATO standard. Had not the ACR programme been scrapped prematurely (the end of the Cold War seeming to be the main real reason), the "HK-ACR" (i.e. the G11) stood a very good chance of emerging as a clear winner, thus subsequently to be adopted as the replacement for the M16A2. Had this happened, other countries would perforce have followed suit.
The main reason for why the Bundestag in 1992 decides to mothball the entire G11 programme was
specifically because the 4.73mm family "no longer is probable to be adopted as NATO standard".
But assume instead the following scenario: with Superpower tensions rising instead of declining in Europe around 1990-91, ACR had been allowed to continue, concluding in 1991 with the HK-ACR being announced as winner. Then Germany would have followed through with its acquisition of the system, and the US would have started its own acquisitions programme.
The Germans
might not have replaced the G3 to 100% by the war breaking out 1995, but probably — bearing in mind that said increased tensions likely would accelerate many military acquisition programmes — not very far from it. The US would also have come part of the way, possibly to the point of most USAREUR units being equipped with it. Some other countries (most particularly Norway) would probably not be far behind.
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EDIT:
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It has since become clear that break of hostilities in this scenario is in fact
not 1995 as I had assumed, but 1997.
That would give all the time necessary for both Germany and the US to pretty close to completely re-arm with the G11.
