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I'm planning a one week vacation in Germany and have the new format Ukrainian biometric passport. I understand that Ukrainian nationals with the biometric passport no longer require a visa to enter Schengen states for vacation / holiday purposes. Can anybody confirm if this is correct and I need any other documentation for border control, such as letter of invitation, proof of accommodation, etc.?

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Yes, that's correct. You can check that with the official announcement and Wikipedia (which also provides link to a database airlines use to deal with these kinds of things).

In principle, the requirements for visa-free visits are almost the same than for visa holders (with one major exception: travel health insurance is not required if you don't need a visa). In practice, border guards seldom spend more than a minute interviewing travellers and do not check any of this in detail. But they can legally deny entry if they are not satisfied that you have a valid purpose, sufficient financial means, etc. and all the documents you would use to establish that when applying for a visa could be useful if you are challenged at the border.

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