According to the novel, Fredo was on Vito's "shitlist".

Why? Because of his bad body guard abilities? Or because of his dandyesk life style in Las Vegas?
In both cases it lets us see Vito in a different light. Not so much as a loving father.
What a monster of a father who can only love you when you fulfil his expectations, especially if it has to do with involvement in criminal actions!

(I even believe that it's Vito's fault that Sonny ended up dead and Michael an unhappy, lonely gangster boss.)