If Jules and Vincent had intended to kill Marvin they would have killed him with Brett and his accomplices. So yes, they were letting him live.
He’d helpfully tipped them off about the location of Marcellus Wallace’s briefcase, and set-up Brett for the hit. They had no reason to kill him, and his loyalty was likely going to be rewarded in some way by Wallace.
Not that either of them, or even Wallace, really cared if he lived or died, though.
(Proof that Vincent Vega is a dangerous moron, on top of being a stone cold killer and a heroin addict. He’s idiotically gesturing in Marvin’s direction with his finger on the trigger of a gun with a round in the chamber, the hammer cocked and the safety off. So yeah, any bump in the road and Marvin is a dead man.)
Marvin’s been useful, but not that useful, and his death is more an irritation than anything else. Not only did Tarantino plays this for some dark comedy, but it also tells you just how much a pair of stone cold killers Jules and Vincent are, and how little Wallace cares about his junior associates.
The only emotion they display after a strung out, jittery and insanely reckless Vincent blows his head off in the car is annoyance over needing to change clothes, clean the car and dispose of the body.
(Not a whole lot of regret, sorrow or even anger going on in this scene. Basically, it’s “Oops. Now what do we do?”)
Wallace even helpfully sends Winston Wolfe to deal with the situation. So much for rewarding Marvin’s loyalty I guess – now that he’s dead, he’s just a problem Wallace’s more important associates need help dealing with.
Basically, Marvin’s life is less valuable to all involved than the dry cleaning bill for two suits, a few minutes of Mr. Wolfe’s time and needing to take a car to the junkyard and get a new one, regardless of what he had done to help them.

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