It's an interesting question. Its function was primarily research oriented. Here's a Wikepedia link -
http://de.wikipedia.org/wiki/Deutsch...%BCr_Luftfahrt
Unfortunately, little has been published on the DVL and I am not aware of anyone specifically researching the DVL. There are quite a few potentially interesting reports at the PRO which might help fill out the picture but as with many questions of the structure of the German aviation industry, you'd pretty much have to do your own research if you are to advance your knowledge.