Why was Napoleon not executed or imprisoned?

You have to read between the lines to get closer to the truth. It was simply that execution of the aristocracy was widely frowned upon and he was, after all, a minor noble married to minor french royalty and then into the house of Hapsburg. 3 million died as a result of Napoleon's actions, most of which were directly attributable to his orders or actions. In the Caribbean and Syria, to name but a few, he was absolutely responsible for the most heinous torture and human rights abuses. Many executions were performed under his instructions for the most insignificant infractions. By today's standards, he would be more closely alligned with the likes of Hitler and other despots. Essentially, as ever, it came down to the double standards of the time.

One of the main reasons that executing Napoleon was never even considered by the British was that he was widely, if begrudgingly admired by their top brass and the British elite, as the probably the greatest military leader the world has ever seen. It pays to remember that he very nearly won at Waterloo, out manoeuvring and out fighting the British as the French had on almost every other occasion they clashed under his command. Such is the nature of wars that momentous victories often hinge on fractionally small acts of chance. Like the British, Napoleon idealised and romantacised war. His inspired leadership and zealous mission to permanently fortify France against countries (most notable England and Austria-Germany) which had previously regarded the invasion of France as a divine right, together with his enlightened dictatorship in conquest, were all greatly admired. He represented in many ways the quintessential militaristic British conqueror. Although, according to his post-Revolution principles he loathed monarchies he promptly established his own nepotistic version thereof, thus re-validating them and possibly restoring hopes that France might one day return to the European Royal's club (most of whom were related to or directly descendant from the French monarchy, and were terrified that the French proletariat's sudden taste for beheading indolent, retarded royals might just catch on at home)

Stone walls do not a prison make,   
Nor iron bars a cage;    
Minds innocent and quiet take    
That for an hermitage;

To Althea, from Prison

Napoleon was imprisoned. He could not travel beyond the confines of the island, nor could anyone visit him. "Prison" isn't defined by the quality of the cell, but by the restrictions on liberties and the possession of civil rights. Napoleon's world was bounded by the coastline of the island, and he had effectively no civil rights. Had the guards decided to abridge his privileges, Napoleon could not have appealed to anyone.

As far as granting him title to the island, the title of Emperor and the "possession" of the island are utterly meaningless. "Emperor" is meaningless if you are your only subject (the British guards on the island remained subjects of the English crown). Titles are only meaningful when they are in the context of an effective, powerful state, and supported by some governance. I wouldn't be surprised to discover that the title was more of an insult than a consolation.

He was probably lucky that he managed to surrender to the British (strictly speaking he claimed political asylum) rather than the Prussians.

Even then he had a number of political supporters in Britain that thought imprisonment was a bit severe!

"To consign to distant exile and imprisonment a foreign and captive Chief, who, after the abdication of his authority, relying on British generosity, had surrendered himself to us, in preference to his other enemies, is unworthy the magnanimity of a great country; " Lady Holland

Napoleon WAS imprisoned. The first time, at Elba, was under "house arrest." Security was lax, and he escaped and started the "100 Days."

The British didn't make the same mistake the second time. The venue chosen for his exile was St. Helena Island in the South Atlantic, one of the most isolated places in the world. It is more than 1000 miles from Angola to the east, then uninhabited by "civilized" people. It is several thousand miles to Brazil, to the west.

A British garrison guarded the island, to prevent escape off the island. A British fleet patrolled the waters around the island, and would have recaptured him if he had somehow launched a boat into the South Atlantic.

As to why he was not put in a conventional prison in Europe, "out of sight, out of mind."

Considering he escaped from an island prison and re-rallied the country, putting him in the Bastille (in the middle of France) and then leaving and demobilzing your army would quite obviously have been a Bad Idea.

As for not executing him...I don't think they could really do that either. His only real "crime" was leading armies against them and losing. If people got executed for that, then any one of them might be executed too if they had lost. Not the best of precidents to set, if you yourself happen to be a general or a monarch.

So they tried to put him somewhere out of France where he couldn't restart things. Even gave him a small kingdom there to keep him busy. He escaped and restarted things. Then they put him somewhere quite a bit further out, and kept a closer guard on him.