I read in a book by exaggerating hitman, Donald Frankos, "Contract Killer" that Gotti Sr. knew that the death of Frankie really was an accident, he was angry, but knew Favara was a civilian and did not do this on purpose and had Gotti Sr. had actually disciplined the child on riding out into the street with that bike.
After the child's death, Gotti Sr. was angry, however it was Victoria Sr., provoked John into killing Favara
You are right about Victoria Sr she was one ugly heartless broad. But I do believe gotti didn't care if favara was a civilian or not