GTK was created for Gimp.The acronym was literally "Gimp ToolKit". It was adopted by the Gnome people, for the reasons you stated (KDE used Qt and the license issue was yet unresolved at the time). And for writing a PhotoShop-style program, at the time, it provided a lot that Qt couldn't.

In fact, Gimp stayed on GTK1 years after everyone else moved to GTK2.