The ISI are Spies. This is What Spies Do.

The pundits are aflutter with the question "What the Hell was Osama doing in Pakistan?" (Not small-arms training, obviously.) Everyone's bubbling with consipiracies about what the Pakistani ISI knew and when they knew it. Michael Ledeen runs this to the hilt, suggesting that not only might the ISI have a motive for betraying Osama...

There are many possible reasons.  One is that things were going badly with us — look at all the tough language coming from the likes of General Petraeus and from leading members of Congress and several spoon-fed journalists — and the gift of bin Laden would make for a happier Obama administration.

...so might Al Qaeda:

The war in Afghanistan is going badly for al-Qaeda. We’ve been slaughtering them for many many months, just read the military reports. So their recruitment is down, their fund-raising is down, their morale is down. Inevitably, this sort of thing produces divisions within the organization. Some of them want to fight on, others say let’s cut our losses and focus on the opportunities elsewhere…the world is changing, after all…

It's not that implausible. On the other hand, Five Rupees points out that intelligence organizations often have blind spots:

Look, if the mil-ISI knew everything there is to know about everything, there’d never be another terrorist attack in Pakistan (they’d just be restricted to Afghanistan and India). Clearly this is not the case. They are evidently caught off guard time and again. Just a couple months ago, there was a suicide bombing inside an army compound in Mardan. More relevantly, less than two years ago was the raid and hostage-taking attack at the army’s headquarters! The headquarters! And this is leaving aside all the terrorist attacks on civilians targets throughout the country that these brilliant and resourceful organizations should ostensibly have intimate knowledge of.

We Americans regard the CIA with the same dualism: All-Powerful Secret Masters of the Land one minute, and Bumbling Blinded Toadies Unable to Locate Their Posteriors with Both Mani and a Torch the next. They can't both be true.

So while I suspect the Pakis knew what was going on and looked the other way because they decided that Osama was worth sacrificing, I'm not going to rule out the possibility that they simply had no idea what was going on. I'm not a spy, so I don't know, and given the poor information control the White House displayed with regard to the raid, I'm not certain the spies know any better.