For cute, reasonably priced clothes I recommend H&M or C&A -- there are several branches of both in Munich. Much cheaper than Petit Bateau stuff, and somewhat cheaper than the department stores too. Also keep an eye on the discounters -- sometimes Aldi
will offer children's clothing and when they do its very cheap. Tchibo also periodically has fairly nice things at good prices.
For everything you need, especially furniture etc., there is a great, huge baby store near Augsburg call Baby Welt.
They have a MUCH better selection and better prices than the Pickauf previously mentioned. BUT -- if you are not driving in that direction anyway, the money you will spend on gas to get there will probably offset the savings, unless you are buying a big ticket item like a stroller (I bought my Hartan Racer there and it was 40 or 50 Euros cheaper than other stores--equivalent to internet discounters but no waiting). We stop there when we go to visit friends in Stuttgart as its on the way (right off the A8) and its really worth a visit.
Speaking of buying stuff online -- eBay has a lot of places that sell new merchandise online at good prices. We got our high chair that way and it was cheaper.
has the biggest catalogue -- their prices are decent, not fantastic but not awful either. You can take a look at their website. I think they also have a store somewhere in the SE Munich area (I live on the north side of town so have not ventured down there).
Also there are tons of second-hand markets for children's stuff in Munich at various churches, pre-schools, etc. - I posted about this recently on a separate thread.