This is going to sound like a rant, but I really don't mean it that way. I'm not trying to make a value judgement.
GNU picked the term "malware" on purpose. I think the purpose was to (slightly) confuse, connect a known bad thing with commercial software, and spur further dissuasion. I doubt they intended to fearmonger though. That said, your intuition that they picked it to "get the free software conversation going" is, IMO, spot on.
They did the same thing with "free" in "free software". When people misinterpreted what they meant, they used that as an opportunity to ... explain their point of view. Many here may not remember when conversations like "it's free software" ... "no, not just free in cost, but free as in freedom" ... "yes, I know it's cost free, but you can charge money if you want" ... "yes, I know no one charges anything, but it's really about freedom!" was a common conversation in tech circles. I suspect a similar goal for "malware" now.
If clarity was a primary goal, they would have, IMO, picked different words.