That's the official version, but at least when I talk about some average dude it's way too long and artificial, I don't think the name Mustermann actually exists.
When I think of the most common name to use in casual conversation, I'd probably go for Müller (maybe Peter? Though the first name is probably heavily generation-dependent).
In older publication you may alse find references to "der deutsche Michel" (the german Michel, short for Michael) as a somewhat condescending reference to the average citizen who is very hesitant to adopt new concepts and tech and not always able or willing to understand complex concepts. Often used to remark that a product/idea will not have a chance on the market because "der deutsche Michel" doesn't see the pointor would never pick it up.
Haven't seen that in a while though, I guess Germans have become more open to new stuff :)
Yay, more Konsi!