It would have been difficult for the Germans to invade without having greater control of the sea, and their paratroopers had ben massacred over Crete, and so weren't available for further operations at this time.
Sure they were available. Hitler just refused to order further drops. They distinguished themselves later on in the war (Cassino to name one) although they were no longer paradropped.
About Malta, I'm convinced it could have been taken but it would have meant using valuable resources which were needed in Northern Africa. It's not that they decided not to invade, they just postponed it. A mistake but understandable given the hopes of Rommel capturing the Suez Channel.
As I stated - "at this time", i.e. around June1941 onwards. They certainly did distinguish themselves at Cassino - in 1944. After the entire German 7th Air Division had been commited to Crete, it did take quite some time for them to be brought back upto strength after their losses. This was hampered by Hitler's unhappiness at the price paid for their use, and yes, as you stated, he banned further use of paratroop operations of this sort.
The Germans also had a problem balancing all their requirements - North Africa and getting ready for Barbarossa.
Couldn't the resources for North Africa had waited? Its not like they were sending masses of supplies over in early 1941. The transport slaughter of April 1943 might have been reduced if Malta was Axis controlled. Such a small island and they just used air power to try to reduce seems half-assed.
Yes, they could have used those resources for Malta and they were going to. But Rommel convinced Hitler to postpone Herkules as an opportunity presented itself at North Africa. In hindsight, this was a short-sighted decision but understandable.
In the end, it wouldn't have mattered much as an axis Malta would have been isolated by the allies and reconquered without too many problems. The axis was not in a position to defend Malta.
If Malta was conquered would it have been a priority by the Allies to recapture? And how long would it take and when? I think the Allies were weak in the Med until Torch and if Malta was Axis controlled North Africa might not have been as easy (not exactly the proper word) as it was.
The Afrika Korps stop at El Alamein is given as the end of the supply line. Would a German control Malta changed this and Alexandia taken? I think its fascinating how alittle island could possibly effect an entire area.