I do not use thia service myself. But a friend of mine, who can not put up a bigger dish had loads of problems with Sky on demand using SmartDNS. He solved the problem by using a dedicated 2nd router ehich has VPN configured on the router itself (most commen internet routers can not do that). All he now needs to do is changing his gateway address to the IP of the 2nd router which then connects to the VPN service via the 1st router (broadband access). Now all his devices work fine without connection errors.
The Sky website has a list of all UK allocated IP addresses. If your IP is not in the list, you won't be able to watch the content. The same goes for German TV when you are trying to watch it over IP outside of Germany. So, if any providers IP address is not listed or the IP allocated is from another range of numbers, it won't work. Happens a lot if you try to watch from a company network which is really owned by a foreign company with offices inside the UK but the network is listed abroad. You could the contact Sky or BBC and try to get your IP listed. This will not work with a number range allocated to a big provider like e.g. German Telekom. Their IP number range is in the public domain. If you need to find out more about IP addresses and whom they are allocated to you can use the ICANN whois server.