My impression is that Henry and Frederick have a faily easy relationship. It might not be close, but I'd say they understand each other. I think Henry sees his brother's interest in Isabella as just another one of his fleeting fancies, and of no harm to Miss Thorpe:

"...he must return to his regiment. And what will then be their acquaintace? The mess-room will drink Isabella Thorpe for a fortnight, and she will laugh with your brother over poor Tilney's passion for a month."

In other words, Frederick's infatuation will have faded after two weeks, likely something Henry's seen happen before. Henry also sees Isabella is not really interested in his brother, but is merely amused by his exagerated wooing. Henry sees I.T. as a women fully aware of the "game" that's being played, and is not a naive young creature who would be devistated by setbacks along the matrimonial road. This is partly observation, and partly Henry's nature (because he is so easy going, he has a blindness for other's emotional weakpoints, unless they are openly expressed, as demonstrated by his father.

However, I also think Henry fails to see the mercenary aspects of Isabella. (Another blindspot for Henry - he isn't concerned about wealth.)