The Nazis sort of developed a network of state-controlled brothels during the war. This included both the civilian and military brothels. The Nazis even set up brothels for the forced labor inmates that helped with the German war effort as incentives for higher production from prisoners in camps.
Back then these brothels were suppose to serving several needs. For the soldiers that were far away from home, the Nazis thought that having these brothels would reduce the possibility of rape in occupied lands and reducing the sexual relations with impure local women or forced laborer's, as well. Heck, the Nazis tried to use these brothel women to cure homosexuality as a treatment with male prisoners that were gay.
Regular German women were exempt from serving in these brothels. German women were suppose to “bear children for the Führer and Fatherland’’ both within marriage or even in some cases, outside of it.
Women serving as sex workers in these brothels were recruited, sometimes voluntarily and sometimes forced. I read that a major source of prostitutes were local women that had been rounded up from the streets to serve in occupied lands.
I also read that Jewish women were not used as prostitutes in these brothels. They had strict laws against ‘Rassenschande’, or racial shame, prohibited sexual contact with Jews.