There are truths and accuracies in the above posts. Vito accepted Tom into his household without commenting on it. He did not show affection to Tom until a brief display upon Sonny's death. As TB states, Michael introduced Tom to Kay as his brother, but went on to describe him as a good lawyer although not a Sicilian. Michael and Sonny and Tom used the phrase "your father" (or similar language) that seems to set Tom apart from Vito (and them). However, I think that those instances are just a function of Puzo's discontinuity.

Now, as I've posted elsewhere several times, the novel states that Sonny and Tom were like actual brothers, but that Michael and Tom were not close at all. My own analysis is that Michael blamed Tom for the decline of the Corleones due to his failure to anticipate and protect the family from the events that led to that decline. Of course, the highlight of that decline was Sonny's murder.

In II, Michael kept Tom out of the loop unless and until he could not afford to keep Tom out of the loop. As others have stated, Michael made Tom the Don after the attempted murder simply because he could not trust anyone else. Also as others have stated, Michael uses Tom when Michael needs to use Tom and that that usefulness comes full cycle when Michael challenges Tom to go along with him or get out.