Jim, the old German gunsmith who lived a couple miles from my Dad once showed me some vierlings and drillings that were engraved and inlaid like this. I used to frequent his gun shop and was looking at the used gun rack one day, and he came over and said in broken English, "These guns... all junk! You want see some nice guns, I show you nice guns." He took me into his house which was attached to the shop, and it was stuffed with guns of all kinds. Many were extremely ornate, heavily engraved, and inlaid with gold, silver, and ivory.
He explained to me that he was trained as an armorer for the German Army during WWII, and that part of his his job was to destroy guns that the Nazi's confiscated from towns and villages they conquered during the Blitzkrieg. They would issue a decree to the residents that they had 24 hours to turn in their guns, and if they were caught with guns after that, they were executed.
He told me he was supposed to remove the stocks from the guns, burn the wood, and put the breech section of the barreled action in a press, and crush it so it could not be recaptured and reused. The scrap was sent to steel mills to be converted to new steel for Nazi weapons. He said, "Oh, I crush a lot of very nice guns, but really nice ones, I keep and stash when I can. Then after the war, I come to United States, and my brother smuggle them over here to me." I have no idea how they accomplished this, but he didn't just have a lot of guns. He literally had tonnage. Not all of it was as nice as your photo, but I saw stuff that rivaled anything I saw in the NRA Museum, Harold's Club Casino gun collection in Reno, or anything else I've seen.
The last time I saw these guns was in 1991 during the first Gulf War. I went to his new house he built after he retired to see if he had some Mauser parts I needed. His wife remembered me and invited me in because he wasn't feeling well. The new house was also stuffed with guns... thousands of them, in every room. Many were getting that dry rust patina that comes from neglect. It would have taken a year just to clean them all. He and his wife were cheering for Saddam Hussein as CNN reported that Iraq was firing Scud missiles into Israel. They called them "Stud Missiles" in their broken English, and saying they hoped Saddam killed all of the Jews. Once a Nazi, always a Nazi, I guess.
I just nod and don't say anything when I hear something like this.