Wales' new-found confidence should have earned a reward on 26 minutes as Tottenham's Gareth Bale and Ledley combined down the left flank.
Ledley drove into the Germany box and Tasci slipped as he backed off, the Stuttgart defender's sprawling hand blocking the ball as he fell.
It seemed a clear penalty, but referee Terje Haunge - who was well-sighted - opted to wave away Wales' spot-kick claims.
Thomas Hitzlsperger nearly added insult to injury as he crashed a free-kick towards the Wales net, only for Hennessey to plunge full-stretch to push the ball away.
The Wolves stopper produced another great save soon after to deny Lukas Podolski from 10 yards, after the Bayern Munich striker was put through by Ballack.
There was no doubt that Germany had had the better of an absorbing first half, but Wales had shown a Millennium Stadium crowd enough to earn a warm round of applause as they left the field at half-time.
Wales boss Toshack had a very different reaction for referee Haunge, showing his displeasure presumably at the official's reading of the Tasci handball incident.
Toshack had further reason to scowl soon after the restart as an own-goal gifted Germany a 2-0 lead.
Germany's Serdar Tasci sends Joe Ledley sprawling in the area
Mario Gomez got lucky as the ball tangled in his legs under a James Collins challenge on the right and the Stuttgart attacker was able to send a hopeful, low cross into the Wales box.
Williams instinctively stuck out a leg and was unfortunate to touch the ball into his own net just inside the near post.
Earnshaw nearly got Wales back in the game minutes later as he wiggled between three defenders, but Enke got an instinctive right hand to the powerful shot.
Germany counter-attacked and Hennessey got his positioning perfect to field Bastian Schweinsteiger's fierce left-foot shot in his midriff.
Ched Evans took over up front for the hard-working Vokes after 62 minutes, while defender Lewin Nyatanga was sacrificed as David Cotterill beefed up Wales' attacking options.
Germany were content to sit back with their two-goal cushion and try to hit Wales on the counter.
Although it was to Wales' credit that they were as much of a threat as their visitors, Toshack's side could not manage to claim a consolation goal despite pushing until the final minute.
Saturday's loss to Finland and now this defeat to Germany snuffs out any faint World Cup qualification hopes Wales may have harboured.
But Toshack can now try to meld a team that can enter future qualification campaigns with realistic hopes of progression.
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