The national ID card is only for citizens; I am not a German citizen.
Registering with the police when you move is standard practice with all countries, USA included - you are required to give your SSN to every single DMV now to receive your state ID card/driver's license. They are available in every police cruiser. Are we going to split hairs over which agency runs the server the laptops in the police cars get to query?
I've never registered anywhere and I have moved a lot. In the states we have at least 20 million undocumented. In Germany you legally have to report someone that doesn't have an ID card.
You don't have a social security card or drivers license? You don't file taxes? You don't have to register anywhere because they don't need that. They update all that kind of information when you file taxes.
Convenience. The reason you have to register is because you moving somewhere puts some level of strain on that community. This registration gives them a chance to get a handle on city migrations. They do the same thing in Switzerland. I don't remember who, but a very rich man was denied the ability to move to some low population city because they couldn't figure out what they would do with his tax money (warning, I've not verified this actually happened but I imagine it could).