I am a born and bred Australian, I have a daughter who is born and raised in germany and my grand parents on my mums side were both dutch is there any way I can get a passport or a special visa so I can live there and be a part of my child's life?

Insufficient info... what nationality is the mom? Are you legally married? Is your name on your daughter's birth certificate? How old is she? Who is taking care of her? Etc.

Need ALL details...

I am a born and bred Australian, I have a daughter who is born and raised in germany and my grand parents on my mums side were both dutch is there any way I can get a passport or a special visa so I can live there and be a part of my child's life? My x girlfriend is german and we are not married or together we are still good friends and I keep in regular contact with both my x and my daughter via webcam and I have been to germany to visit my daughter. My daughter is 2 years old. My name is on the birth certificate

You were not legally married, so even your name is in the baby's birth certificate, it does not establish paternity unless you claim paternity in court. If you consider relocation on family based visa, you must be legally married.

So your only choice is either find employment in that country or they move back to Australia...