It was done, in part, for security purposes. And in practice, how much of a difference was there, hmm...
A lot. In practical terms, there was a lot of difference.
Start from the fact that there were, actually, two iron curtains.
An Eastern German could, possibly with some paperwork, travel to Poland or to Hungary or whatever. His trip to USSR was a bit harder to do, though not impossible (still, once in the USSR he'd be subject to a lot of restrictions: a Bulgarian foreign student in Moscow would need a permit to travel out of town, for instance, nor would he be able to go to areas "closed" to foreigners, etc.). In more liberal countries, such as, say Hungary, a native could even travel occasionally to the West, sort of, as a matter of course, at least by the early 80s (say, every few years and if there were no bad problems on file, etc. etc.). Even in Eastern Germany the level of contacts w/ the West was infinitely higher than that normal inside the USSR proper.
A Russian could buy a train ticket and go to Estonia, no questions asked. But travelling further west was very, very difficult. Normally, the first foreign trip would have to be to a super-safe place, such as Bulgaria. Before the trip (which would almost inevitably have to be sponsored by, say, his union organization), such Russian tourist/visitor would have to go to the district Party Committee, where he'd be examined on all sorts of matters, with probing questions asked about how he'd respond to "provocations" while abroad (yes, "provocations" in Bulgaria). If the first trip were a success (i.e., nobody reported anything bad, etc., etc.) one could hope to be allowed to go to, say, Czechoslovakia. Only after some trips to sociallist countries could a trip to a capitalist country or Yugoslavia be authorized (Yugoslavs were treated as capitalists for these purposes). Any minor hiccup on file and all foreign trips would be cut for the individual in question. Being "vyezdnoj" (literally, "exitable") even to sociallist countries was a big privillege, that would be the first one to be withdrawn if there were any doubts.
Politically, there were big issues as well. Zhivkov in Bulgaria or Hoenecker in GDR were actual local "number ones". Within the Soviet Union the nominal leaders ("First Party Secretaries") would also be local ethnics. However, more often than not, the true power belonged to the "Second Secretary", who'd almost always be an ethnic Russian sent from Moscow. Even if the strong First Secretary actually had the real authority (some of them would be on the Politburo, etc., far outranking the "seconds" in the hierarchy), he had to tolerate a Moscow emissary as his second in command.
There were many ways in which the satelites were "tansitional" in terms of the degree of control between the USSR and the rest of the world. It did make a lot of difference for them.
