It depends on your target market. For example if you're making an app for early adopters you'd want to go with a high end model, but if you're doing something for the mass market you might want to look at what's popular.

It might also depend on what country your market is in since say the most popular Android phone in China won't be the most popular Android phone in Europe.

Something else to keep in mind about the Android market is how fragmented it is in terms things like screen size. So with that in mind in an ideal world you may want to have several phones to test on.