It had to have happened in between the time of Sonny's death and the meeting. Don't forget this all took place in the late 1940's or early 1950's. It would have taken a while for the word to get from New York to Palermo to the Sicilian countryside that a deal was struck and Michael was not to have been touched. Turned out to be an interesting outcome for Kay.
Welcome back, DT!
I agree that we shouldn't overlook the time lag in communication back then. I don't recall seeing any telephones (or telephone lines) in the Sicilian scenes. Even if the hit happened after the meeting, it's unlikely that Barzini easily get a message to Fabrizio to call off the plan.
It's also possible that Barzini didn't make it a real priority to call off the plan. He still wanted to be #1 and killing Michael would have furthered that plan, deal or no deal.
