In some ways, Michael was the perfect don. Although Vito perfected the art and gave each seperate quality to his sons, Michael was the ruthless one. Which counts in Organized Crime.
Vito wouldn't have ordered Fredo to be killed, he was too attached to his family. Michael did what had to be done without remorse, he could seperate himself from anything and regard it as "just business." His ruthless streak, cunning and coolness made him the best choice out of them all for a Don.
And Al Neri is wicked, he's done all of the best hits for Michael, Barzini, The Vatican Bank Cardinal, Fredo. He's a great UB.