East Germany was meant to be the "showcase" state to the West. Given it's proximity to the West it was the best way to show the "success of socialism". Also, the fact that there was a West Germany meant that East Germany had a state to always be compared and measured against. Poland didn't have to look like it was as great as France, but the East didn't want East Germany to be dwarfed by West Germany. Molotov and other Soviets speak of this in Post World War II Europe 1945 - 1965: An Analysis.

Secondly, the region of Germany was economically strong historically. It was where the landed aristocracy (the Junkers) had lived. It was a regional hub for technology, and East Germany always prided itself on it's chemical and technological engineering.

Militarily, the NVA was the first bulwark against Western aggression. The People's Army would subsequently be extremely well trained and equipped, as it was considered to be one of the two major security states of the East, the USSR being the other.

Thirdly is that the Soviets chose to use East Germany to channel down orders throughout the bloc. The reasoning for this is mixed, and the history is complicated as until 1953 there were still many in the Soviet leadership that desired to united the two German states into a neutral Germany. However, by 1960 East Germany would be the "right hand man" in the Eastern bloc. This was for because of it's economic power, but mostly because of it's proximity to the West. As the frontline of battle, it grew to have an incredible military, and economically was subsidized so that it's living standards could be shown off to the West (though all Western countries quickly outgrew it).

Sources:

The Court of the Red Tsar, Post World War II Europe 1945 - 1965, A Short History of Communism.