From what I can tell looking at the Google-translated version of the German Wikipedia articles on Kalendresser and Kölner Rathaus (Cologne City Hall), the Kallendresser (a man squatting to relieve himself) is a traditional element of Cologne decorative architechture. An influential architect in Cologne restored a house in the 1950s with an original medieval Kallendresser statue and helped to make the Kallendresser popular in modern times, which probably helps explain why such statues were included when the statuary on the tower of the Cologne City Hall was restored post-WWII. (There were apparently several in the original medieval tower decoration.)
I couldn’t find anything about whether that particular one was a copy of a medieval original, but I’ve certainly seen medieval decorations that would be considered obscene today, so it wouldn’t surprise me. In any event, it appears that the “Cologne mirror” is a traditional variation on the standard Kallendresser in which the man squatting has his head bent down and peers at the viewer from between his legs. I imagine that once a sculptor had that much planned out, with the natural proximity of mouth and genitals, the addition of the cock-sucking was just too obvious for anyone–whether modern or medieval–to resist.
ETA–I don’t know the etymology of Spiegel (Ger: mirror), but I suspect that “Cologne mirror” is a mistranslation, and that the phrase „Kölner Spiegel“ somehow refers to the fact that the figure looks back at the viewer.