I do believe that Fredo knew. He could not have believed that Al was going to take him on a simple witness-free fishing trip. And why did he get in the boat? I believe that he had accepted his fate as such, and was willing to die for what he did.

1. Michael had become his whole life. He lived on the estate, had no wife, had no kids. He was everything that his father wasn't. He had no life except that which his brother offered him.

2. I believe, as you can see from his facial expressions during the "drink" in Havana, that he was wracked with guilt for what he had done. I think that part of him was willing to accept the punishment for his betrayal.