Discovered by whom? And harsh in what way?

Outside of those two big question the answers are rooted in trade. New Orleans occupies a critically important juncture on major trade routes. The location was used by Native Americans because it is on a land bridge between the Mississippi River and Lake Pontchartrain. The city was founded on the location of the current French Quarter by Bienville, he chose this particular spot because it is the highest firmest ground in the entire region. This is important, because it makes for more stable foundations for buildings and streets, and makes it less likely to flood. New Orleans today is plagued by potholes and houses that lean and need to be leveled (an expensive operation) because of the softness of the ground, the French Quarter is largely immune from these problems. And even after the US Army Corps of engineers funneled trillions of gallons of water into the city during Hurricane Katrina the French Quarter didn't flood. It was the ideal location in the area for city building.

As far as the harsh environment that can mean a lot of things. New Orleans is hurricane prone, incredibly hot and humid during the very long summers, surrounded by swamps, and hosts fleets of mosquitoes nearly year round. Additionally, the swamps are populated by alligators and one of the most aggressive poisonous snakes on the planet, the water moccasin. It can be a very difficult place to live comfortably, that much is certain. It is also a place blessed by incredible natural wealth.

New Orleans is surrounded by one of the most productive fisheries in the world, one of the most productive fur areas, and incredibly rich and abundant topsoil (this is an area with a very long growing season). Even without taking petroleum and transportation into account Southeastern Louisiana is a very strong food producer. So it would have been settled by farmers one way or another. Of course the City of New Orleans was founded to control the mouth of the Mississippi River. Rivers mean trade, and any place where two navigable rivers merge will draw a city to conduct that trade. Any place where a large navigable river meets the sea will draw both a city and a port. New Orleans is situated on the nearest suitable high ground to the mouth of the Mississippi River. It controls the connection between the sea and a series of rivers that run through Montana, Minnesota, and Western Pennsylvania among other places. River towns on this network include Pittsburgh, St. Louis, Minneapolis, Cincinnati, Nashville and Memphis. The River is navigable through it's tributaries to very near the Great Lakes as well, the land bridge connecting the two is the location of Chicago. For both military and trade reasons controlling this point is critically important, and that is why the city was built by the French, as the capitol of their massive Louisiana colony and connection between the colony and the sea lanes to France.

The location is still in use for this reason. Sea ports tend to be in fairly exposed locations, and are often subject to issues from weather related problems, and environmental dangers to humans because of swamps. But the locations are also food rich and critical for trade, so they build up. New Orleans has always been one of the most important ports in the western hemisphere (it is currently the largest, it historically trades that distinction with New York), and that is dependent on location. A city has to exist there for the US economy to function, the same as a city was needed when the French founded it for their colonial economy to function.