The most common answer here will be: evil must be allowed to have free will. This is simply not true. If we are speaking of an omnipotent God that created the entire universe and any extra dimensional space we can't observe, then couldn't he have come up with something better? If not and this was the only way free will could exist, then why have it when having it means horrible things will happen to your people? Babies being raped to death, mass genocide, beheadings, starvation etc. Wouldn't a God that cared about his people realize that free will is not worth the mass destruction caused by the human race? Not to mention such atrocities as disease, which is not a necessary component for free will's existence, that also flourishes in this environment here on earth. What is its purpose? The questions asked here are rhetorical, the main question stands.
Free Will is a Necessity for Love. Evil is a Necessity for Nothing.
God’s original creation was perfect. It included free will and did not include evil1. Why would God create free will? Because true love is impossible without it. God could be said to have created the capacity for evil, but that is not the same as creating evil. What the omnipotent God has always sought from us is love. That is the only goal. That evil could exist for a time is a byproduct of God’s created order, but it was never inherent in creation. Evil exists because we rebelled against God.
Could an Omnipotent God have a Purpose for Evil?
The crux of your complaint has to do with the consequences of someone else’s (evil) choices. Why does the all-powerful God allow innocent people to suffer the consequences of someone else’s choices?
In general, the unpleasant consequences for our rebellious choices is meant to help us by steering us away from those choices. How could the suffering of innocent people be justified? Perhaps we would not understand the very destructive, permeating nature of our sin if we did not observe the tragedy it foists upon others. We like to pretend that our sins only hurt us, but that is lie we tell ourselves in an attempt to make our sin seem less bad. Our sin affects people around us: people who depend on us, people who love us, people who expect us not to crash into them when they’re driving on the same road as us, etc.
The pain caused by the consequences of sin has the potential to teach us something important. Rather than imagining God to be vindictive in his punishment, it makes more sense to consider that if he loves us, he will want us to turn from our sin, and will use pain to get our attention. Ravi Zacharias tells a story of a girl who was born without the ability to feel pain. Her life is in constant jeopardy because pain is the means by which a normal human body tells you something is wrong. She feels none, and so she has no way of sensing the peril she is in and reacting to it. Our pain is unpleasant, but it is vitally important to our own well-being—even if the pain is because of someone else’s choices.
Could an Omnipotent God Use Suffering, Too?
This is not explicitly in the question, but it is in your remarks.
The corruption that our sin brought into the world means that pain and suffering are simple realities that will never go away in this life. What purpose could an omnipotent god have for allowing undeserved suffering?
Ever since the fall, the world has been corrupted. God’s perfect creation has been defaced and spoiled, and only in death/destruction will that ever change. The pain that we must endure in this life is certainly meant to produce in us a longing for that perfect world that we willingly abandoned.2
Jesus distilled the meaning of eternal life as “knowing God.” (Jn 17:3) This is the entire purpose of our existence. It was in the beginning, and still is, though now we have made it more difficult. The injustice we feel when witnessing or experiencing suffering should lead us to want something better, and the only satisfying object of that desire is God himself. Suffering has this purpose, at least. The death of a loved one should make us long for a companion who will not die. Loneliness and rejection should make us yearn for a friend who loves us and will not leave or reject us. The very things that we need are those things that mortal, fallible human beings cannot guarantee us, but God can provide those things.
The Omnipotent God did not design us for any greater purpose than loving him. While he has the power to prevent pain and suffering, he chooses not do so at least some of the time. Rather, he uses pain and suffering to help us understand the truth, because he loves us and wants us to love him.
1 What about Satan? Was he created evil? The fact that God condemns Satan for his choices at least suggests that he was not. We are not plainly told much of Satan’s origins, but the simplest explanation that makes sense of the facts we have is that he chose to rebel against God. The original assertion stands: God’s original creation did not include evil.
2 What about innocent children? Why do they suffer never having had a chance to make such choices? Some might argue that children are never wholly innocent, only ignorant, of their sin. The weight behind the question is about having to live with this pain, and being alive means having an opportunity to grow. The death of children is devastatingly sad, but it is not the topic of this question.