The e-mails do make it look pretty bad. Now, we all can be selfish and think, "Well, he should reported this internally", but I think he initially weighed the options and felt that any potential leak of information regarding players possibly being involved could jeopardize their safety. In hind sight, nearly all of us would say he should've brought this to the attention of someone within the athletic and/or compliance functions, but I think he was at the time making the decision he felt was in protection of his players, and by protection I mean from criminals and not the NCAA (although you could argue they're one and the same).
One needs to look at intent here. Did he find out about players violating NCAA rules? Yep. Were the violations "stand-alone" violations, i.e., were they simply violations that had no other potential consequences? Nope. He wasn't refraining from reporting the violations because players could get suspended but rather because players could be in serious peopardy through retatiation by the criminal element. Tressel's 15 years in Youngstown taught him that there are folks you simply don't risk [censored]ing with.
It's not like he found out that Pryor and Herron were selling personal stuff to some old folks home--where there is no potential danger--for big profits and then went out of his way to cover it up.