What you are saying does make sense but I wwould be interested to see the other answers. I also run a few sites that are essentially the same but in different languages and targeted to different countries but I have seen no ill effects from interlinking them. In fact I think it has helped.

One of the first things I did was to change the links to KW anchor instead of English, German etc as it was and that had a positive effect on those KW's which I took as proof that it was a good thing.

Hey, It's fine if you interlink sites that you own. However, you should follow the best practices of doing this. You should read this article- Interlinking Your Sites - Whiteboard Friday | SEOmoz this will surely help.

The only right method that I would recommend interlinking your own websites would be to use the NO FOLLOW tag on your backlinks. This will not help boost your SEO directly but will prove to the search engines that you are not trying to cheat with your interlinking websites.