Though my family has Austrian roots, I've never had potatoes and kraut in one dish. We eat sweet and sour red cabbage with onions and apples cold or hot and potato salads both cold and hot. We really like this dish cold. It's a great covered dish to bring to a brats BBQ. My cabbage preparation is cooked on medium low heat in a small amount of water, with salt, lemon and cider vinegar. Brown sugar to taste. Cloves and course cracked pepper are also an early part of the mix.
Beware stick to medium or low heat with cabbage. High heat when cooking cabbage or Brussels sprouts will bring out the sulpher = terrible flavor.
I'm getting ready to make a baby red bliss potato salad right now. I cook the potatoes in advance and add everything else the night before serving. Chilling the potatoes after cooking helps hold their shape.
Yes, I do cook medium diced onions with the cabbage. I have learned to dice the apples at the last minute (3/8" to 1/2"), throw them in and stir well. Then immediately cover and turn off the pot. The apples will turn red and soften but still have a bit of tooth. Otherwise the apples will disappear in the dish. Granny Smith's work well but other firm apples are good. This comes out something like what I'd call a relish. Mine is similar to this http://vicsrecipes.blogspot.com/2007/01/sweet-and-sour-red-cabbage.html You will see recipes with butter. Don't use butter if you plant to serve it cold. You will have coagulated fat blobs.