Yes, I agree Tessio was one of my favorite characters. However, this is what I think were his reasons for betraying Michael:

- He might have had a strong regime, but Barzini was more powerful after Vito died. The novel has a passage that says (I believe it's during Vito's funeral) that the Barzini were now undoubtedly the strongest Family.

- It wasn't a question of if he would come under Barzini's thumb, it's that he thought Barzini would win out in the end. If Tessio had formed his own Family, Barzini would still have pressured him to join the Barzini faction or die. Tessio must have figured that Barzini would win in the end and he would HAVE to join, wether it was as his own Family or as a member of the Corleones. By selling out the Corleones, Tessio would be on the winning side (or so he thought..) AND probably become a high ranking person to Don Barzini (although it's my opinion that had his plan succeeded Barzini would have had him killed eventually; after all, he betrayed his old Don, what's to stop him from betraying his new one if someone better comes along).

Just my thoughts.