It's a conference aimed at game development business. Microsoft interest in the field is large and important, as platforms holder but also as a tool vendor.
There's their console business, which is important to promote at such an event, but there's also their other products: Windows Vista (the gaming platform, but also the servers and groupwares software development requires), Windows Mobile, .Net, DirectX, Visual Studio, etc.
Whether a game developer or publisher decides to start a project on a MS platform (Xbox, Windows, Games For Windows, Windows Mobile) or not. This developer/publisher can still be a MS consumer since the company sells development platforms and tools. And MS is a very big player in the field.
Most games, for whatever destination platform, are being developed under a windows environment. Couple that software vendor business approach to the fact that they're also supporting two major gaming platforms, in the form of Xbox 360 and Games For Windows, then it should not be surprising to see that MS needs a large booth to expose all its offerings at GDC.
Now, if you folks are looking for surprises or big announcements, you should all keep an eye on the various press conferences.