Vic and Casso was paranoid psychos so every person that in their minds could be a menace for their power must be killed.They started killing the powerful bronx faction leaders plus they believe (and killed many people for this reason) that Dilapi was an fbi informant or would be rat after out of prison.
DiLapi did close to ten years in prison, if he was going to rat it would have been before he started his sentence. It makes no sense to do almost ten years in prison and then turn rat.
