Complex sentence: Although they fielded competitive sides, they had the misfortune of playing in the same division as Schalke 04 which was the dominant team of the era: VfLs best result was a distant second place in 1938--39.
Split into simpler sentences: Although they fielded competitive sides, they had the misfortune of playing in the same division as Schalke 04, which was the dominant team of the era. VfL's best result was therefore a distant second place in 1938--39.