Was azt (zidovudine) originally developed for cancer?

Yes: It was originally developed as a nucleoside analog. It was thought that it might lead to false replication of dna in tumor cells. It failed. That goes back to the 60's. Later drugs of this type were tested for retroviruses and the rest is history. There is a nice article from the ny times in 1986.

Although it: Has chemical structure of a nucleoside, and 6-mercaptopurine analog, an agent used to treat leukemia, azt (zidovudine) was inert against human leukemia and solid tumors. It has reverse-transriptase inhibition, rns virus need that enzyme to make dna, which in turn can insert into human dna. It is this use that led to testing against HIV virus.