Things probably looked rather good for Germany in 1941. Hitler hadn't been wrong yet and Regular Army leaders like Guderian had make him look smart, with runaway successes through the low countries and France - meanwhile, he believed it would take years for the U.S. to mobilize for war and the true morass of the Russian campaign was not known yet.
After the war, LIFE bought and published pictures from a 'Christmas' party that year, taken by Hugo Jaeger, one of Der Fuhrer’s personal photographers. Hitler, like most tyrants, didn't like what religion meant regarding equality of people so he replaced the Judeo-Christian God with the Norse Odin and forced Germans to celebrate the 'winter solstice' instead of Christmas. Sometimes they mixed it up with an angel inside a swastika.
Military parties are never all that giddy anyway so it's no surprise the pictures look somber. The pictures survived because Jaeger buried them in jars near the end of the war.
Here is a sample from the Daily Mail:
