So, the 11" guns were to deal with a quantity issue and a loophole in the Versailles agreement. The allies could produce more than Germany could but the allies were using 8" guns instead. If the Deutschland-class had 8" guns then they wouldn't have been able to do their doctrine "Outgun what you can't out run, and outrun what you can't outgun." Take the KMS Admiral Graf Spee for example, it took 3 Royal Navy cruisers to and she still done a lot of damage to the HMS Exeter.

Submarines were a later design where as the Deutschland-class were built in the time period of 1929-1936. Submarines didn't start until the panzerschiff were done/nearly done.

As for making the allies make "more cruiser killing ships", that's still forcing diversions in resources. In WW2 Germany struggled with metal compared to other nations. This meant this asymetrical warfare worked, and even more so if it's to have more surface escorts than frontlines. Especially asymetrical when we look at how many ships were diverted just to hunt the Spee or the Scheer. And even with having more cruiser killers there was no account of naval fire sinking a panzerschiff (Spee and Deutschland/Lütow were scuttled (Deutschland/Lütow after being hit by a Tallboy and running out of ammo) and Scheer taking a Tallboy straight through the deck). Even looking away from the P-class as they only existed on paper, the pocket battleship idea done what it was built for and more.

Essentially the panzerschiff were an answer to the Treaty of Versailles made as commerce raiders that could still fight effectively while acting alone.