Why China's first wide body aircraft is so big? The fuselage is 5.92 meters wide, about the same width as Airbus A350. Shouldn't it be more logical that China build a smaller wide-body airliner (5.2-5.4m fuselage width for an 8-seat abreast in economy configuration), and then build something bigger? There are other advantages for starting with a smaller wide body aircraft.
1. The current configuration is in direct competition with Boeing 787 and Airbus A350, which are the most popular planes from these two established players. A smaller wide body will target a more niche market where there is much less competition, and will be appealing to more lean route (7000-11,000km distance with not enough traffic to justify 787 or A350). Only competition will be A330neo, which is an old product with small upgrade. Much easier to compete against A330neo than 787+A350.
2. Military application. A 5.2-5.4m wide airliner will be a more suitable platform for AWACS or tanker. 767 (5.1 meters wide) and A330 (5.6 meters wide) are used as a platform for AWACS and tanker, 787 and A350 would be too big. Yes, there are restrictions for Chinese military to use this airliner as a military platform, they cannot use any western component and dosing so would risk Western sanction against the whole program. Chinese military probably would use these airliners as military platforms only after domestic supply for every component is developed. Still, start with a smaller wide body airliner just makes more sense, from both economic and defense perspectives.
(Just for note - The 5.92 meter-wide figure is for the fuselage width of the C929, whereas the cabin width is listed as 5.62 meters.)
Quite likely because COMAC anticipates greater carrying capacity demand in the coming years, and that the 3-3-3 (i.e. 9 abreast) sitting configuration in economy class will become the mainstay configuration, hence necessitating a wider fuselage for the C929 compared to the A330neo and 787. Going for the narrower 2-4-2 (8 abreast) means losing out on the bigger chunks of the market pie and making the C929 redundant in the long run.
The A330neo only has a 2-4-2 (8 abreast) economy seating configuration. And while the 787 offers both 2-4-2 (8 abreast) and 3-3-3 (9 abreast) economy seating configurations thanks to its slightly wider fuselage (5.49 meters vs 5.26 meters), the 3-3-3 configuration isn't exactly pleasant and comfortable (
Yes, I had several not-that-nice experience of sitting in one for a couple 8-hour-long journeys).
Besides, modern-day commercial airliners that can carry more passengers with only marginal if not negligible fuel consumption increase (i.e. better fuel efficiency) thanks to advancing aviation technology is always better. Moreover, economy class tickets aren't exactly the major earners for airlines (especially budget airlines with high-capacity, long-haul route demands), hence it is always preferable to be able to cramp as many seats in the economy class as possible to increase sales revenue.
(Yes, the last sentence that sounds harsh and borderline immoral, but that's just how things are.)
Furthermore, a niche market can also mean not a lot of potential sales once the original demand gaps have already been filled up (which can happen pretty quickly with a not-so-large market). That's why regional jets don't get a lot of sales besides the established players of Embraer E/E2-Jets and A220, alongside why many regional jet projects (including the infamous Mitsubishi SpaceJet) are dead even before arrival.
As for military applications - The 767s and A330s are older airframes (with their first flights in 1981 and 1992, respectively) that have been in service for decades, hence proven record of service reliability.
Also, military utility shouldn’t dictate commercial design, as commercial airliner manufacturers (Airbus and Boeing) are always exclusively focused on meeting the demands and requirements of commercial (mainly passenger service) operations during their research and development stages. The air forces typically selects certain commercial airliners as platforms for their military applications (tankers, AEW&C, ELINT, ASW etc) when they find them suitable for their needs, not the other way around.
Last-but-not-least, there's the C939 which is in the early stages of development, and is planned to compete against the 777X. That means the C939 is only going to be wider than the C929 (and similar to the 777X), with 3-4-3 (10 abreast) economy seating configurations.