I've always thought Rocco was involved in the hit. I think Michael says 'Rocco ALIVE' because he feels Rocco will kill them when he finds them...as he does. Rocco told the boys where to hide out, sent everybody elsewhere while he strolled over and shot the pair of them

If he didnt do it who did? Neri was out sorting Klingman, Fredo? Fuggghetaboutit.

Also, in the Trilogy version, look out fo a moment of Rocco telling some guys off...the shooters maybe?

Sonny - Well then, business will have to suffer, all right? And listen, do me a favor, Tom. No more advice on how to patch things up, just help me win, please