Malak betrayed Revan by shooting at the bridge of Revan's ship, trying to kill both his master and jedi onboard. Malak failed to kill Revan because Bastila saved the sith lord's life (and thus creating a bond between the two). Still, Revan was heavily wounded, physiacally and also, in my opinion, mentaly. Bastila brought Revan to the jedi counci. As wounded he/she was, the council decided to to give the Sith lord new identity and use his/her knowledge against the Sith. Also "Jedi do not believe in killing their prisoners" and this is another reason for sparing Revan's life.
K2 "blurrs" this concept from the first game because Kreia said several times that evan never thruly fall to the DArk Side, becoming a Sith Lord was needed to protct the galaxy from a geater evil, etc. So, believe in what you wish.