As I've posted before:
I think Vito's plan was for Michael to "legitimize" the family by running for political office. As "Senator Corleone" or "Governor Corleone," Michael would work to legalize gambling (with the Corleones as the big power in legal gambling) and to funnel Vito's labor rackets money into his own political coffers. Sonny would be head of a diminishing "illegitimate" Corleone "olive oil business." Sonny would provide strong-arm and protection for Michael during his rise to political power, then gradually fade from the scene. Alas for all, Vito's misjudgment of Sollozzo turned the entire scenario around.
Luciano, Michael wasn't soft. You should heed Don Cardi's post, especially the part about Michael being the toughest. In the novel, Sonny acknowledged that point right after Michael volunteered to kill Sollozzo and McCluskey.