Most of the changes in Michael took place without Kay knowing about it, mostly in Sicily. When he comes back, I believe it is only natural that he goes back to Kay. I believe he truly WANTS to make the family legitimate and what better mate than Kay? As for why she took him back, the man she loved disappeared without a goodbye. That makes it almost impossible for someone to move on, since she never had any closure. She wouldn't necessarily understand how he had changed, and still believe that he was like the boy she fell in love with in college.