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.